 Wow, I am really overwhelmed by the amount of support for this session and for this topic Good morning. Good morning. Thank you for coming This is a tech and entrepreneur session. So let's start to have some tech fun Can I can I have this? So that's a little bit about me I like to say that my real job is that of a struggling author Struggling because I love to write books, but nobody reads books these days But I'm going to be telling you some stories about this book, which has just come out called sustainable Sustainability why ESG is not enough and hopefully we'll make links to what does that have to do with entrepreneurs like yourselves? So here we go. Let's have some fun to begin with. So here's what I'd like to do if you would take out your phones and And join this quiz with me, please. So it's a tech summit, right? Let's do some tech So go ahead Join the quiz. Is it working? Yeah, I don't see the ah, there you go. I'll give you another minute. I do have a prize for the winner in the end So shall we go? I'll set Yeah, okay. So here's the first question How many earths do we need to cater to current levels of resource consumption? We are eight billion people in the world not enough water not enough food not enough air How many earths do we currently need to take care of eight billion people leave alone the increasing population? and 6% of you got that right already we need 1.7 earths and they say global population is gonna hit 12 billion by the turn of the Century God help us if you entrepreneurs don't innovate to find solutions to existential challenges today Here's the next one. So Praveen, you're the owner winner right now, but we'll see whether you keep the lead Here's another one normally five species go extinct every year How many times over the normal rate it is now of species extinction? So typically in history about five species would go down every year now that is how many times more than the normal rate What do you think take a guess? It's one of those things on the screen might shock some of you and again only a very small percentage We've got that right is 10,000 times the normal rate of species extinction Have you heard of the five mass extinctions? We are in the midst of the sixth one if we don't do anything about it and the good news is that we can and 1% of the people of the people in this world are twice as rich as how many people We are 8 billion people in the world the top richest 1% are richer than how many are twice as rich as how many people Take a guess. So the top 1% are twice as rich as how many people? Good job. This time the majority of you got it Imagine the 1% are richer than 7 billion people in this world What percentage of humanity 8 billion people what percentage of that 8 billion lives on less than five and a half dollars a day? in most countries Conceiving living on less than five and a half dollars a day is Impossible and a good number of you only 11% got that right, but it is half of humanity Income inequality. That is the gap. Here's my favorite one How many rich men in this world? We were talking about women in the previous session How many rich men in this world have more women more wealth than all the women of Africa? This one is a shocker to me personally How many rich men have more wealth than all the women of Africa put together? There are 56 countries in Africa, by the way you're ready for this 22 men put together are richer than all the women of Africa We've been celebrating yesterday. I wrote an article for the Deccan herald about about women about gender equality Okay, and it is absolutely Impossible to imagine this absolutely we've been celebrating International Women's Day. How old do you think International Women's Day is anybody? Since when have we been celebrating International Women's Day anyone? Take a guess 10 years 15 years a hundred years More than a century. We've been celebrating International Women's Day and yet this is the situation So folks, we don't get it. We just don't get it. How often does a cybersecurity attack happen somewhere in the world? This is a major cybersecurity attack on a company and the answer is You got this one, right? Every 39 seconds. Here's another one on this How many computer files are stolen every second? Now, this is your and my files included I'm almost to the end of the quiz and then I'll give you the story. Okay Bear with me for just a minute In my in the previous conference I spoke I was keeping 15 seconds. They said increase it now 30 is too much, right? Okay 44 files per second and How many dollars are currently available in so-called ESG funds in the world, you know What are ESG funds? This is cheaper capital available to solve for Climate change socio-economic inequality and cyber vulnerability and those kinds of challenges cheaper capital ESG funds How much money is parked in ESG funds around the world? By the way, they say you need about 50 trillion dollars to meaningfully reverse climate change That's the number by the World Bank. How much of that of money is currently parked in ESG funds? Actually, the number is 43 trillion as of yesterday That is one third of total assets under management my friends in the whole world 43 trillion and they say we need 50 trillion to reverse climate change So that's good news, right because it's growing at 12% keger. No, it's not Here's the question that I that's not in the quiz How much of this 43 trillion is actually going towards climate action or social action? Do you think it's money meant to go towards climate action social action cyber action How much of the 43 trillion is currently be actually going towards that? What do you think anybody? Sorry Maybe 1% is right hardly anything. It's all in Interbank trading Suddenly how did we have 43 trillions in ESG assets 10 years ago? Nobody was talking about ESG, right? They just normal funds really earmarked as ESG again and box checking is going on so my final question Are ESG and currents other current situations adequate and meaningfully reversing climate change socioeconomic inequality and cyber vulnerability all the things everybody's talking about sustainability sustainability sustainability these days, right? Is it going to be enough the current efforts? I'm glad a hundred percent of you said no Because absolutely not is the answer. So just a minute So I need barn. Where are you? Okay? See me after the session and I will give you your your prize Although it may not be much of a prize. It might be disturbing. But anyway, thank congratulations So my friends the good news is that everybody's talking about the fact that we need to do something about these challenges, right? What most people don't realize is that we live in a world that is in which everybody is completely naked You me our organizations everything and everybody is totally naked thanks to digitization, right? I'd like to bring your attention to two more things There's a lot of talk about purpose these days You need to give up some profit in order to get go go for a worthy purpose and don't just be greedy for profit I would like to reject that motion if we are going to save this world. We are going to save it with profit Okay, so profit is not a bad word more on that later And finally ESG is going to solve our problems know my friends these notions which are very popular these days I am going to debunk them to you in the next 20 minutes stay with me so The front-runner solution for all our existential problems and we have less than two decades to save the world Otherwise the planet may not survive. Okay, and I'm not over exaggerating The front-runner solution amongst all the solutions is ESG ESG ESG But the need of the hour is to make money By addressing those very challenges that threaten us in other words the need of the hour in business whether you're an startup entrepreneur or whether you are an established entrepreneur the need is to do well by doing good Question is is it possible to drive profit by pursuing purpose? And I'm going to try and prove to you that yes, you can But if you think about it on the day you start your startup Somebody I met the other day and I started to hear what's your new book about I said it's about sustainable sustainability through business And he says oh, sorry. I'm an early-stage startup. This is not for me. Talk to me five years later when I'm generating cash wrong The best entrepreneurs are those who think about it on day one and Everybody was a startup one day all the big companies that you see today And the best ones from the type of Tatas in India to the VIP pros in Bangalore to the Ayala's in In the Philippines to Patagonia in the use in the in the in the in the Americas to Faber Castell in in in Germany They were all startups one day and they thought sustainability on the first day and they've been surviving for 200 plus years That was the secret of their success. So don't tell me that you're going to talk about this after you are successful No, no, no if you are a genius If you are a genius then tell me that you accept the 21st century leadership challenge Which is to make money by addressing the very challenges that are threatening us today That is the leadership challenge of the 21st century my friends and I will show you that it is possible Okay, here's another quiz this CEO Provided 290% return to their shareholders over their 10 years a CEO Okay, they did it by creating a sustainability based business plan double the growth half the negative impact on the environment and triple the positive impact on social and they did not do it under any Regulatory pressure. Who is this anyone? Big multinational company whose products all of you use Big huge FMCG multinational any guess Sorry Well, you're almost there. It's actually Unilever not just Hindustan Unilever. Okay, Unilever under Paul Polman's time 290% by the way in the first two years talk price tanked Okay profitability tank because he got out of very profitable lines of business because they were bad for society or the environment But the board supported him and that's when the magic happened in the first two years 75% of his top management team quit and left This guy is going to drive the company to the ground. They said but he hung on he hung on 21,000% stock price appreciation since IPO in 1992 fortunes most admired company for 21 years now And they focus on the S the social aspect of ESG they provide full health care benefits Even to part-time workers and they are spending more money on benefits than they spend on raw material And they've been doing it from day one since they were a startup today. They're a massive company. You see them all over the world Who is this? Hint in India. They have a partnership a joint venture with the Tatas Sorry This guy was a son of very poor immigrants in America. Okay? His father was a temporary worker had no medical insurance when he broke his leg He couldn't get medicines. He couldn't get treatment They couldn't eat dinner at night sometimes the family and he said I will create a company My father never had the chance to work for where everybody gets full health care benefits He didn't think about it after he was successful. He thought about it on those early days in business and doing profit and profitably growing for more than a hundred and fifty-five years now average age of a company is only 18 years and this conglomerate has a footprint in over 100 countries and 66% of share capital is owned by philanthropic trust their motto is we make money so we give it away which conglomerate is this sorry Absolutely, it is the Tatas well done, but we are talking about sustainability today Look what Jamshedji Tata said in the 1800s in a free enterprise. The community is just not another stakeholder It is the very fact why we exist From day one my friends I need you to rethink what success looks like in a startup. I need you to rethink what entrepreneurship is all about Okay, and I will give you the formula in a minute. Here's my favorite and last story The picture you see here this one of scotch to earth is the Golden Triangle the the border between Myanmar Thailand and Laos Okay, 30 years ago this independent heavily on militia was controlling the villages in that region There were only two two professions prostitution and and drugs based on opium cultivation and massive Deforestation was taking place because they were growing opium, right? There were no hospitals There were no schools nearby. So if you felt sick, the only medicine was opium. So there was heavy-duty addiction as well If you did not go into one of those two to two professions, you would be beaten up mercilessly All right, one day the princess mother arrived in a helicopter and said no I reject this motion We see a better future here. She challenged her team To do something about it her foundation that is Thirty years later my friends. This is what that picture looks like. I was there very recently with my research team And this is just one of the stories in our book sustainable sustainability and the same impoverished Villagers who were being beaten up into sex trade and and and drugs every day today run and own highly successful highly profitable businesses in coffee, macadamia and handicraft fabrics tourism And they are a global people come from all over the world to learn sustainability and circular economy from them I take groups for study groups. They have next group. I'm taking there is in November of CEOs from around the world I take 30 people at a time and we show them what sustainable business Profitable how profit can solve today's problems Amazing story also in the book So in case you're interested and if you want to talk more and talk to me after the session and For all these great stories that are also the villains You all know about the diesel gates candle Right what happened in 2008? Guess what you don't know this was not the first time they did something like this This was also not the second time they did something like this my friends. This was the third time they did it I for one will never buy a Volkswagen or a Porsche I used to own a Porsche when I lived in New York, okay a nice 911 turbo never again will I touch any of these vehicles third time? How can you trust them? spread the word and Then you've heard the story of Teranos Right Erica Chong who used to be the who was the scientist who broke the story work young Berkeley graduate who broke the story I interviewed her on stage last year. I said you were a 22-year-old something. Weren't you scared? She says yes, I was under surveillance. They gave me all kinds of threats My parents told me to back off, but I said no I cannot let people die because of wrong tests, right? So if you look at all of these we can create a spectrum of environmental and social Ambition and you need to think about this no matter which stage you are in in your business Green washers or purpose washers they profit from today's challenges. That's the runners. That's Volkswagen Blissfully ignorant what climate change what socioeconomic inequality even if it exists, it's not my problem. I pay taxes Let the government handle it Window dressers. Oh, everybody's talking about sustainability these days. I can't be seen as not doing anything Let me do a little bit so people think I'm doing a lot of great job people come to conferences and give speeches Okay, they dress up their windows all form hardly any substance box checkers Because there's a lot of regulation these days. So I don't want to go to jail I'll do exactly what the law says and no more Okay, check the box and then you have the true champions of environment and society They are profitably solving these problems. They create profitable solutions to today's challenges And those are the examples that I gave you Right. The question is how do you move more organizations to the right? Yeah, how do you create some more to answer this question? I'm gonna ask you guys another question. What is common amongst Enron Tehranos and FTX? You all know FTX. Yeah, Sam Bankman Fried. He's now pleading to please give me a shorter sentence. I screwed up Please please please mercy What's common between them? Anyone Missaligned that six you said what else? What else anybody what was the board doing? I'll give you a hint Misrepresentation of that what was the board doing? So that's the hint as to what was what was common between these three Sorry Turning a blind eye basically poor governance, isn't it wherever in the world I ask this question ladies and gentlemen the answer I get is they are the result of poor compliance poor delige poor diligence and poor governance, right? And if that's the response, what do we normally do? We have more rely more governance more compliance more rules more regulations, right? Oh, let's make sure this never happens again, right? Let's have tighter rules this that in the other that's our only response Yeah, not gonna save the world. It's not gonna save the world I met a very interesting guy a few years ago. His name is Andy fast out. Anybody know Andy fast out the name You all know the name and run He was the last CFO of and run who was the mastermind of all the corruption that was going on over there And he spent six years in jail. He came out close sooner than his Colleagues because he became a prover right and he had a lot of time to think in jail So he wanted to write the book and tell people what not to do somebody said talk to Rajeev Rajeev writes great books on leadership, and you guys will write a great book. So I spent two hours with him Talking about what the book would look like. Here's what he said to me Many people believe and Ron was a failure of compliance. I disagree what anyone was was a culture failure It was a culture of loopholes where the principles didn't matter only technical adherence to the rules He said we showed the world that you can create the biggest corporate fraud in history without breaking a single law They went around it ultimately. They all went to jail because the Intent to deferred was confirmed Not because they broke the law as such Okay Now Andy was on the on the on the speaker circuit and he would start with showing a picture like this He would stand on stage like this He said I got both these things on the same year for the same deals I stopped for Enron this he said is my CFO of the year award for the most innovative financial deals This he said is my prison card. I got this in January. I got this in May for the same deals Right so my friends if we think more governance and more compliance is going to save us God help us We asked a bunch of boards all over Asia. How do you spend your time? Okay, and this is what came out More than 60% of the time goes on financial performance regulatory compliance and risk management And we just replicated this study all over the world same data even in America even in Europe We asked the board members What do you are you spending enough time or less time or too little time on each of these activities? And this is what they said these are the things that we don't spend enough time on Today the only source of competitive advantage is your culture and we don't spend any time on it Sustainability is the biggest problem of our times and we don't spend any time on them is governance Go is G the G of ESG going to save us from E and S challenges forget it You the entrepreneurs will save us if at all Here's the problem with governance. We focus only on these three things Okay. Yes regulation is important. We need laws for civil society to function. Okay, but here are problems with Regulations that's the minimum standard of good behavior if you don't be below that I will send you to jail just because I don't break the law makes me a good person. No There's two different things Right. So regulation only sets the minimum Regulation may preserve present value, but does not enhance future value what we need to solve for today's challenges is huge amounts of innovation Innovation cannot be legislated and Regulation is usually reactive when things are screwed up Then regulators coming and let's make sure it never happens again too little too late for the people that already suffered Then they say, oh, it's about measurement and incentives what gets measured and incentivized gets done You've heard that before right famous management idiom totally wrong When you focus too much on measurement based incentives When me as a CEO my bonus is linked to some ESG scores. What do you think I do? It's not what gets measured gets done my friends what gets done gets measured in a way that makes me look good I have a higher an army of people whose job is to create data and measurements that make me look good So I can get the highest bonus. I did so much for society. Yeah, right We've known this for 45 to 50 years. There was a very famous article the world's most downloaded management article that ever came out 45 years ago, but if you read it tomorrow, it's like it was written today It's called on the folly of rewarding a while hoping for be where they show that the more you measure the more bad behavior You create. Okay. Let me give you a fun example in Basketball the teams that win more than others the most winning teams What is the core skill and competency for winning more games than losing in basketball? What do most winning basketballs team do better than other teams anyone? They play better together Yes, yes, what's the activity you're on the right track? Teamwork, but what does teamwork look like in the middle of a match? passing Passing the ball. Okay. The more you pass better the more you win better, right? How does the NBA draft players for professional basketball on what basis? What data are they looking at? Exactly on what? Shooting scores. So if I am playing a match and I want to get drafted. Do I pass or do I shoot on? The folly of rewarding a while hoping for be my case about measurement driving bad behavior rests my friends So we ask people the true champions these guys, right? What motivates them the most what motivates the Tatars that we prose the Patagonia's of the world to do well by doing good Is it measurement and reporting? Is it compliance? Is it tax? Is it cheaper capital or is it something else? 92% of my global database in 25 countries chose number five They don't do it because of regulation. They don't do it because of incentives or cheaper capital They do it because they want to because they want to leave the world safer for their children and because they want to leave a legacy So a few more minutes to finish I'll skip this, but I already told you 92% of the people agree with it It's not just leadership. What you need is stored leadership by talking to a hundred companies who are doing well by doing good We all the research is in the book We learned that what these people do is practice toward leadership. What is stored leadership? It's two words stewardship and leadership, right? Let's look at that Leadership is usually seen as somebody has a CEO telling people what to do Black suit usually a guy Do this. I asked people, you know define leadership and they say always anywhere in the world the definition comes up in a Room like this leadership is the act of coaching inspiring guiding Motivating directing dissing or batting people towards achieving some common goals Meaning leadership is what you do to other people. No Gandhi didn't do anything to other people Mandela didn't do anything to other people George Martin Luther King didn't do anything to other people whatever they did to themselves and what was what came as a result was inspired followership So my friends that definition of leadership is outdated The leadership Definition that is evolving now is leadership is the genuine desire and persistence to create a better future You don't need direct reports. You don't need title. You don't need capital You need a burning desire in your heart to create a better future Then you are a leader already Similarly stewardship is seen as a steward on a plane who serves you coffee or somebody who takes care of our money outdated definition the definition of stewardship today is stewardship is creating value by Addressing the very challenges that are threatening us today by integrating the needs of stakeholders society future generations and the environment Not just the shareholder or the promoter, but by everybody So steward leadership is a combination of leadership plus stewardship. We borrow from the definition of leadership and say Steward leadership is still the genuine desire and persistence to create a better future But we borrow from stewardship and say not just the future for shareholder a collective better future The challenge of 21st century leadership my friends is this do you want to be a steward leader? Will you make pots of money for yourself and God bless you? I hope you do by solving today's challenges That's the genius. I'm looking for if you're making billions of dollars and doing a crypto platform. I'm not impressed So what is steward leadership? Very quickly to most towards resides more three simple steps. It's not rocket science to understand It's easy to understand. What it needs is determination from day one Step one and we learned this from all the great steward leaders We met and watched the stories that I told you the first is we find that they believe in four specific values What are those four values? Interdependence I believe the more I do for society the more I will succeed in my business They strongly believe that the more I give the more I get long-term view There may be some short term prospered in the long term. I'm going to be super successful Ownership mentality I choose to be a steward leader. I want to make money not by screwing the world But by solving the problems of the world That's how I want to make money and finally creative resilience I will find the innovation and I will keep struggling until I find it to find profitable models That helped me make money and solve the world's problem these champions They believe in these four values different words, but that's the essence in Mars company one of those companies We studied very closely. They don't call it interdependence. They call it mutuality and they have a whole Sort of text on what they call economics of mutuality how the more you focus on society the more you make money That's step one step to now you define clearly your stewardship purpose Which is the better future you want to create pick one area some part of the environment whether it's food whether it's water or Inequality or something they're 17 SDGs Sustainable development goals pick one and make that your center of your business model focus focus focus and step three Everything you do now every decision you make as a company from day one goes through the lens of your steward leadership compass You ask yourself. Are we in adherence with these values? Is it going towards our purpose? If not revisit Day in and day out. That's what steward leadership steward leaders do and there are plenty of examples Of how they are making money and making the world a better place. That's the challenge So I will skip this these are some tools that we have which are detailed in our literature of how to measure yourself If you want to be a steward leader, etc. But ladies and gentlemen, I want to leave you with a couple of final thoughts governance uses the power of rules and threats and Carrots and sticks Steward leader leadership uses the power of purpose values and profit profit is not a bad word so We are recommending that the moniker ESG be upgraded to ESL where L stands for leadership specifically steward leadership Does your organization have a strong compass of stewardship values and purpose? Is the compass used to guide decision-making at all levels? Is it just a beautiful poster on the wall which it is in most cases and Most importantly, do you have innovation engines in your company to solve for E and S? That's the essence of what I wanted to share my friends today I want to leave you with one last thought before I open it up to questions The day you begin to think like a steward of planet Earth think of yourself as a steward of planet Earth and humanity You're pivot from seeing sustainability as a cost problem to a leadership and growth opportunity This book is available outside for sale, but I don't recommend you buy it unless you have a strong heart Because it will disturb you to think differently and if you start thinking differently, you will have to act differently So buy it at your own risk. It's available outside with that. I will open up for questions. What questions do you have for me? Thank you very much Anything that I made confusing anything that you would like me to address any lingering doubt still in your head as to what is he talking about? Yes, ma'am. I'll give you a mic Hi, how's it going? So my research is focused on investments and how investors make decisions So the narrative within the entrepreneurial ecosystem. I I completely agree with everything that you're talking about There's a massive change in the way that entrepreneurs are choosing to solve problems The challenge actually happens when they go and try and get investment Because right now the way that the entrepreneurial ecosystem measures success is whether you are a unicorn or not and the way that the Finance is being structured is all about extreme growth Rather than being able to figure out how to do something that is blended finance or purpose and profit So I'm wondering what your Thoughts are around the way that capital is structured as well as how do you navigate that as someone who is Wanting to be a leader in sustainability But is faced with the way that the current capital works So you're raising a very pertinent issue Capital as a force of good is a huge problem. Okay. I already showed you 43 trillion dollars in ESG funds Not even one percent is actually going towards ERS, right? The only form of capital that only two forms of capital that are actually making a difference One is there are certain places where commercial capital will not go So you need some philanthropic capital to get started. So the best asset owners understand that and then the ones that are having an impact on profitable art is impact capital But any other asset management form of capital absolutely not Unfortunately, the financial industry has a long way to go on this and I don't have a great answer It's a huge problem I work for one of the largest sovereign wealth funds of the world and I can tell you we are trying very hard to change the thinking It's a long haul. I believe I'm allowed to take only two or three more questions So who else has a burning question? Get you we'll get you next Go ahead ma'am Hi, my name is Shiri so as a You spoke about Stuart leadership and all that So I do understand as a leader probably I Believe in sustainability and I would like to carry forward But how to make the same concept believable to all the people who's in my team I was going to work along with me for a longer period of time. Yes And that's not that easy to get the same mindset. So somebody said to me in a conference where 500 people in the room just the other day and said Rajeev, aren't you naive? You're talking about this goody tissue stuff. How can you convince everybody to become a steward leader? Human beings are wired by greed and personal interest. Okay, and short-termism and you're talking long-term You're talking about giving rather than taking are you naive or what nice? Hello, Rajeev, but this is not true Here's the good news ma'am You know, I agree that 80% of the people will not buy into what I'm saying I am I can give it to you in writing 80% of the people will do the opposite of what we have discussed today But that's no problem All we need to convince is two out of every 10 and we will save the world We definitely will if we get to 20% why am I confident about the 20% number? Have you heard of a guy called Wilfredo Pareto? The Pareto principle the 80-20 rule 20% of the people create 80% of the magic and that has not been debunked for 106 years that mathematics is still valid two out of ten start with yourself Convert yourself first and maybe one person will follow you and you are done That's all you need We'll take one last question. Yeah, hi, my name is Mustafa and We have a tech startup based out of Pune and we have a headquarters in Istanbul as well so we are a legal tech company and Yeah, can you hear okay? So we are a legal tech company based out of Istanbul with an office Development center in Pune. I want to know like how like you mentioned like very big use cases very big companies But for a small startup like a budding startup 50 to 100 people How do you apply these kind of sustainability rules or how do you approach? Speaking to your team and you know like delving into these principles next to a leadership I think part of the question was asked by her, but how do you start? How do you start what this this approach like Stuart leadership in in in the company in a small company like applying these Principles it starts with you making a decision that you want to be a Stuart leader It starts with me. I want to be as rich as anybody else. I'm convinced How do you think it's others that come up with an innovative model and show people that if you come with me Not only will be saved the world, but we will make also money. Okay. Let me ask you a question Jeff Bezos Amazon did not pay a cent of Dividend for 20 years. How did how come no investor deserted him 20 years of no money Because he convinced them that if you stay with me, you're gonna make more money than ever seen in history You're gonna come up with that strategy then convince people. That's how you do it. Sorry. Okay, so I believe I've been running out of time So I will not let you Even though we were quite behind I just want to share one more thing with you many of you are doing great work We recognize the 25 best examples in Asia Pacific of anybody solving a problem of environment or society Profitably in Singapore you get invited to Singapore you get recognized as case studies are written by NCR And us if you know of it go to this Site and apply it costs you nothing and you'll get a lot of reputational capital Secondly, we have a website like a Wikipedia called stewardship commons comm if you have something to say on this topic become a Contributor and people can use your knowledge all over the world for free. You don't charge a cent for this so If you are an entrepreneur that has an idea and you're doing something profitably Nominate yourself for getting recognized you will get a lot of reputational capital And if you want to consume knowledge or share knowledge join stewardship commons comm. Thank you very much You've been it's been a huge pleasure and thank you