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CEO of global agri-business Olam: Why 'doing good also means doing well'

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Key Points
  • Investors are increasingly seeing sustainable practices as strategic for positive returns, according to business leaders who spoke Thursday at CNBC's Managing Asia: Sustainable Entrepreneurship conference in Kuala Lumpur, Malaysia.
  • Sunny Verghese, CEO of global commodity giant Olam, said his employees feel better and proud to work for a company with values, and that translates into better productivity.
(from left) CNBC anchor Christine Tan discusses sustainable entrepreneurship with Delman Lee, president and chief technology officer at TAL Group; Nanette Medved-Po, founder of Generation Hope and Friends of Hope; and Sunny Verghese, Group CEO of Olam International.
CNBC

Many investors now see sustainable practices as strategic for positive returns in the long run, business leaders said on Thursday.

An advocate of such practices, Sunny Verghese, who is the CEO of global commodity giant Olam, said that wasn't always the case. His company, whose largest investors are Singapore's Temasek Holdings and Japan's Mitsubishi, is known for pushing the sustainability agenda.

Before Olam found shareholders with the same vision, however, it was a tough sell, Verghese explained during CNBC's Managing Asia: Sustainable Entrepreneurship conference in Kuala Lumpur, Malaysia.

"Several years ago, shareholders from all over the world ... were consistently telling me, 'If you are feeling some kind of guilt because your children are telling you (that) you are not doing the right thing and you want to use the company's assets to redeem yourself, we will not allow you to do it,'" he said.

It took time and effort to not just look for investors with values that resonate with Olam, but also effort to prove and convince others that "doing good also means doing well," he said.

In recent years, Olam has launched various initiatives to track commodities from farmers and right through middlemen and the supply chain — thus ensuring customers they are buying sustainable produce.

Employees also feel better and proud to work for a company with values, and that translates into better productivity, he added.

Garment maker TAL Group's chief technology officer, Delman Lee, said a staff survey at his company showed that sustainability was a priority for workers — so making strides toward that goal will help win hearts and improve staff retention. TAL Group is a member of the Sustainable Apparel Coalition.

After all, consumers who buy products do want to feel that they are buying from a socially responsible company, as Actress Nanette Medved-Po's Generation Hope proves. That social enterprise builds classrooms across the Philippines with the proceeds of sales from its bottled water, "Hope in a Bottle."

When Medved-Po first started, she struggled to find partners for her project, as many were concerned about the bottom line from a social enterprise, she said at the "Managing Asia" event.

Medved-Po now counts names like Starbucks, 7-Eleven and Holiday Inn as partners, proving that a product can be both commercially viable and socially responsible.

A Malaysian minister who spoke at the event also championed the cause as a business case not just for companies themselves but as a potential whole industry, such as green services.

"Whenever we talk about sustainability, people are thinking 'it's about saving the world.' I would think that it's not only about saving the world; it's a business opportunity," said Yeo Bee Yin, Malaysia's energy, science, technology, environment and climate change minister.