Grow with Governance: ESG is the umbrella for CSR, says Vedanta's Roma Balwani

Bharathy Iyer and Jescilia K

06 Aug 2021

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Grow with Governance: ESG is the umbrella for CSR, says Vedanta's Roma Balwani

Learn, unlearn and relearn gives you a wholesome approach to life, opines Roma Balwani, President -- Brand and Communications of Vedanta Group. Balwani, who is also an Independent Director and board member with John Cockerill India, shares her corporate journey and view on governance. She further explains the relationship between Corporate Social Responsibility (CSR) and Environmental, Social, and Corporate Governance (ESG) in an interview with MentorMyBoard’s (MMB) Bharathy Iyer and Free Press Journal’s (FPJ) Jescilia K. This interview is part of the ongoing series titled ‘Grow with Governance’ organised by MMB and FPJ.

https://youtu.be/zLaEZtvALPg

Edited excerpts:

How did your board journey start from being an employee to becoming a board member?

My board journey started accidentally at Mahindra. One of the companies that were supposed to close down was a listed entity. Thus, there was a need to have all the directors. And then by rotation, I was introduced to the board of that Mahindra company.

Learning from that experience was the learning of a lifetime -- learning both as a professional and board member. I learnt how the regulatory framework of carrying on the board duties are allocated; how do you contribute as a board member; how responsible are you to stakeholders and shareholders; to go through the regulatory process I learned the value of ethics and governance, among other learnings.

I was not always in communication. I started off with Larsen & Toubro at the administration level. It helped me understand the general roles of management and other aspects of the business.

When my daughter was born, I took a hiatus from my professional career. During that time, I explored my creative side and was introduced to branding. So, these various experiences were a melting pot for me.

When you learn, unlearn and relearn that gives you a wholesome approach to personal and professional life.

What is your view on new SEBI regulations vis-a-vis reputational risk?

The new regulation for the Board Directors puts a lot of responsibility on organisations.

When you are part of the board, you bring your own brand, reputation, credibility apart from the experience you bring to the board -- these factors cannot be discounted.

Young professionals need to be aware of the organisation before joining the board as reputational risk can either make or break the organisation.

Governance is seen as a hindrance at times. Your view.

Governance is non-negotiable in an organisation — if this mantra is followed then it carries the weight and relevance across the organisation. This is very critical in today’s day and age.

It is important that every person in the company follows the ethics of an organisation and aligns with the code of conduct. This will ensure that these values do not lie only at the board level, but are cascaded down to the last person in the organisation.

Can you share your international experience?

My experience in John Cockerill gave me an insight on how businesses are international, how stakeholders are impacting your business, allowing me to understand the best practices around the world among other insights.

On the board of John Cockerill India, there is the chairman, finance director and technical head from the parent company based out of Belgium. When you have such a well-rounded board, you get a lot of insight and learning. And in turn, you show them the economy, democracy of India, cultural fabric, and the way employees in Indian function. I think marrying both is relevant in this scenario where the business is based out of India but you are bringing in all the international flavours into that business proposition.

Is there any literary work that shaped your journey?

There is a book by Jim Collins’ Good to Great. It is about the journey to becoming 'great' from 'good'.

Has more awareness around ESG simplified your CSR task?

It has not been simplified. You still need to demystify it for CSR teams. For instance, natural resource company Vedanta looks at CSR as a social license to operate. In that case, they need to look at employment, education, issues faced by stakeholders among other things.

In the case of ESG, there is an ‘E’ and ‘G’ to it. They understand the ‘S’. But they do not marry all of them together.

In Vedanta, we are carrying out a big project on social performance that is a pilot project in the interiors of Odisha. Here social performance is the key to know how a business runs in harmony with the community. Social performance is to understand the impact of CSR. ESG creates a measurable tool.

CSR comes under the social performance attribute. Today, ESG is the umbrella for CSR.