Integrating sustainability at Aitken Spence PLC
As sustainability reporting evolves, so too must the balancing act between environmental, social and economic priorities. Aitken Spence PLC’s comprehensive integrated sustainability policy is helping the business reach new heights.
Sustainability reporting focuses on performance in key economic, environmental, social and governance areas. How does Aitken Spence incorporate these sustainability principles into its business processes?
Aitken Spence is a pioneer in the corporate sustainability movement in Sri Lanka. For us, sustainability is the fundamental practice of ensuring our operations can be sustained in the long term. As a diversified conglomerate, we follow a strategy to combine operational priorities of all our subsidiaries under one policy framework to guide them on required action.
Accordingly, we have stipulated action points as ‘must do’ (essential action), ‘should do’ (where specific subsidiaries are expected to take action beyond the basics, based on the nature and scale of the impacts), and ‘could do’ (exemplary action to create differentiation for our businesses through sustainability).
Resulting from this strategy, we have over 40 environmental management systems and a pool of more than 400 employees trained as internal auditors, Environmental Management Representatives, first aid officers and fire wardens. Our companies maintain more than 60 diverse management systems certified under international benchmarks for environment, quality, product responsibility and social sustainability. Collectively, 26% of the Group’s direct energy consumption is from renewable sources; 74% of the total water withdrawn is treated for reuse or safe disposal. Our investments towards sustainability driven process improvements and action plans amount to Rs. 153 Mn for 2018/19.
What drives your organization to think sustainability in a competitive business world? How difficult is it to be sustainable and ensure that the bottom-line is not impacted?
We have always focused on a triple bottom line approach to do good business. It is a strategy that differentiates us from the competition. The fourth P is focus on processes that combines all three in managing the triple bottom line.
We were the first to move overseas for hotel operations and port management services. Heritance Kandalama was LEED certified at a time nobody in this part of the world had heard of it. We were the first in South Asia to build a LEED certified printing facility. Our plantations are the first to move into the production of berries. We are building Sri Lanka’s first waste to energy project. We have dared to do new things that struck a winning balance between environmental, social and economic priorities.
It is important to strike that balance because the opportunity cost of proactively controlling operations to be sustainable is better than controlling damage.
Do you have a group wide sustainability policy, and how has it evolved since its introduction?
The integrated sustainability policy of Aitken Spence PLC was developed to encapsulate the operational priorities of all our companies into one guiding policy and an implementation framework with guidelines for each policy clause to help subsidiaries decide on action plans. Over the years we have expanded this policy to include priorities from human rights at the workplace to responsible communication.
Furthermore, each subsidiary has diverse policies and systems to manage their priorities. The Group’s policy guides them on what is expected in managing these priorities. This framework was ranked best in class for policy coverage by the STING Corporate Accountability Index which is currently the country’s most comprehensive index for sustainability practices.
What new initiatives has Aitken Spence launched during the last two years?
We opened Heritance Aarah in the Maldives in 2019; it is the first LEED certified property in the Maldives. Identifying the need to empower women in the workforce by enabling supporting infrastructure, the hotels sector invested Rs. 70Mn in a staff accommodation for female staff at Heritance Kandalama to encourage more female participation in the workforce.
In the last 5 years, our generation of renewable energy increased by 293% with the support of subsidiaries who have implemented diverse projects. Plantations segment committed to utilise all factory roofs to generate solar energy to match their direct energy consumption from nonrenewable sources. This process is now more than 75% complete. The Logistics sector invested towards solar energy generation and implemented the first phase of the project at Mabola, Wattala and Katunayake.
Breaking ground yet again, we are building Sri Lanka’s first waste to energy project at an investment of Rs. 13Bn. This power plant is monitored for performance against our own social and environmental performance benchmarks as well as international benchmarks such as the IFC Performance Standards to ensure sustainability both during the construction phase and during its operations.
Sustainability reporting is gradually evolving, professional bodies are driving businesses to think and act on sustainability reporting.
How important is this to a company like Aitken Spence? How important is it to be recognized by a professional body like ACCA?
We adopted the GRI framework to report on our social and environmental performance in 2008. At that time, there were very few organisations that correctly understood the distinction between charity and sustainability and recognised the value of sustainability. We are honoured to be among the pioneers who propelled the movement for sustainability reporting in Sri Lanka.
We are happy that organisations like ACCA have consistently recognised the efforts of companies to adopt credible sustainability reporting practices and supported the movement for better reporting.
On what parameters are your company’s sustainability initiatives based? Do you base it on a percentage of profits or on innovative concepts that lend to the nation’s growth?
Our priorities are industry specific and identified by studying our impacts. For example, for any energy intensive operations, management of energy use is a priority. Accordingly, efforts such as process improvements to generate cleaner energy, control measures to reduce energy consumption, investment in renewable energy etc. would be implemented. We do not believe in allocating a specific percentage based budget which could be counterproductive. Rather, our approach is to select priorities and decide on the required funds based on the nature and scale of the impact, positive or negative. We also align with national needs and specific Sustainable Development Goals applicable to our operations to contribute positively on local and global development priorities.
Dr. Jehan Perera - Executive Director National Peace Council