According to experts, India’s lack of professionals with standardised skillsets in the environmental, social, and governance (ESG) area is proving to be a key hurdle in achieving the net-zero emission ambitions by 2050. According to Think Change Forum, an independent think tank, ESG investments in India are worth between $30 and $40 billion and are fast expanding.
Need for ESG Experts
ESG adopters in India need the necessary financial resources, technological resources, and people resources in the form of ESG professionals and experts to make rapid overall growth.
“While progress has been made on the first two aspects, challenges with respect to a pipeline of ESG experts and human resources need urgent attention,” Think Change Forum said in a statement.
Taking part in a roundtable organised by the think tank, Kumar Subramanian, Founding Partner and Managing Director, Sculpt Partners, a sustainability centric advisory firm, said,”Over the years, in India, we seem to have made some progress as far as sustainable financing and technology are concerned, but today, we really need to jump-start the process of creating a pool of skilled ESG professionals who can work at the cross-section of business and sustainability.”
As is the case with many mission-critical enterprise agendas, progression on ESG matters requires a combination of financial capital, technology, as well as investments in human capital, he added.
Expressing similar views, Larsen & Toubro Ltd Head Corporate Sustainability Pradeep Panigarhi said as far as ESG targets are concerned, there is a need to have the “right expertise within the team”.
“You need to build real expertise; just giving training or introducing another capacity-building programme doesn’t help. You need to understand the nitty-gritty of the business. Then only things work,” Panigarhi added.
Challenge for MSMEs
Purnamita Dasgupta, Chair Professor and Head, Institute of Economic Growth’s Environmental and Resource Economics Unit, pointed out that while large-cap corporations may find it easier to grow in certain areas such as ESG, smaller businesses may not be able to do so.
“The key question is, how do MSMEs cope with the situation, and how do we really bring them into the ESG fold? While there are a lot of opportunities, opportunities become important when we are able to place them in context,” Dasgupta said.
According to the Think Change Forum, given the urgency of the situation, it is critical to find innovative solutions that will enable existing professionals to work on the ESG agenda in the short term, while industries and academia work together in the long term to develop a pool of ESG talent that is industry absorbable.
“For instance, the clean energy sector alone would require more than 100 million professionals globally over the next 10-20 years. The number constitutes more than 3 per cent of the total global employable workforce that we have today. So, a mix of immediate and long-term measures is required to address the acute shortage of ESG professionals,” it said.
According to the think tank, the availability of qualified and trained ESG professionals in India will enable a large number of small and medium enterprises (MSMEs), which play a vital role in job creation and the broader economy, to access the requisite skills and set and accomplish ESG targets.
“The current set of consultants in the field are untested and do not have a standardised skillset. Further, expert agencies operating in the space offer their services at very high rates, making it impossible for small business entities to afford them,” it added.