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Pioneers talk sustainability and cost - what does the future hold?

Friday, 19. February 2021
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Rajendra Gandhi, founder of India’s largest rubber recycling company, told how he founded Gujarat Rubber Products (GRP), following a profound change of heart. He was addressing an online forum on sustainability, the second in a series on sustainability in business and the economy, under the auspices of Initiatives of Change in Business and Economy (IofC B&E).

Accompanied by his son, Harsh, Joint Managing Director of GRP, and Tom Marshall, a British graduate of Rotterdam School of Management, the three men provided critical insight into the evolving landscape of environmental responsibility in business - both past and present.

A change of attitude

Rajendra Gandhi

Rajendra Gandhi had undergone a turning point in his life when studying Metallurgical Engineering in Mumbai over 50 years ago, he said. His encounter with Initiatives of Change had challenged him 'to experiment with the simple but powerful idea that, if you want to see the world change, the best place to start is with yourself.' He had learnt about 'the power of inner listening' and the courage of one's convictions.

He had had the 'compelling thought' to leave his father’s textile business and start his own company, after reading a World Bank report that suggested recycling had a bright future, long before 'sustainability' and 'the circular economy' became common concepts.

However, recycling, Gandhi said, offered four opportunities:

  1. Employment
  2. Reduced dependency on virgin resources
  3. Converting hazardous waste into useful raw material
  4. Earning foreign exchange

Rajendra Gandhi explained that he had 'a crazy idea' in a time of quiet, to build his own processing technology in India rather than import the machinery. GRP commissioned its first processing technology in 1978. 'One of the key decisions I took then was to keep the process labour intensive, so that I could offer jobs to the needy.'

The company started making a profit in 1982. While this brought relief to the family, bankers and shareholders, 'my own joy came from having succeeded in starting a business based on right motives.' The company ploughed back profits to expand its manufacturing capacity to eight locations across India.

A part of the solution

Harsh Gandhi

'By choosing to start a business in recycling end-of-life tyres, I and my company became part of the solution to the sustainability of the environment,' Gandhi concluded. 'By choosing the right practices and building trust with various stakeholders, I created a sustainable business model.'

Harsh Gandhi added that the company had benefited from the 'tailwinds for growth', including global awareness of the use of Green materials to lower dependency on fossil fuels. The financial crisis of 2008-09 had 'brought increased focus on the Sustainable Development Goals set by the United Nations'.

GRP has since diversified into other businesses, he said. These included a tyre re-treading business as well as separating Nylon from the tyres to provide raw material for the manufacture of plastic components for automotive and electrical applications. 'So what started as a recycling company with a single product has completed a circular economy journey to become a sustainable materials company with a global footprint.'

Time to change the model

Tom Marshall

In regards to the economy today, Tom Marshall, an international career coach and a climate activist with Extinction Rebellion, noted that the neoliberal economic model was failing to address the climate crisis. Global CO2 emissions were still rising despite climate agreements. Even if the targets of the Paris climate treaty are met, 'we are still on course for a catastrophic 3.2 degrees of warming.'

He acknowledged that the market was 'a powerful river that has flowed riches to us over the years. It’s lifted hundreds of millions of people out of absolute poverty. It can be a force for good.'

But, in his view, the problems were fourfold:

  1. Corporate executives had to maximise shareholder value and so 'the river of the market drowns environmental initiatives'
  2. Innovation by companies was failing, because companies directed their investment towards maximising profitability often at the expense of the environment.
  3. Unseen costs of doing business, such as the exploitation of the oceans, forests, and air, were being disregarded.
  4. ‘Fundamental incumbent power dynamics at play. Those who benefit from the status quo have been tasked to change it. Why would those in power want to change?'

Marshall called for far greater intervention from the public sector. It was already happening in governments’ responses to the COVID-19 pandemic. The UK and the USA are pouring public money into supporting businesses rather than letting them fail. 'State intervention,' on a scale not seen since WWII 'is on the way back'.

Leading the way

Marshall called for a mixed economy, 'where business and citizens live in harmony, without rampant capitalism distorting markets and exploiting citizens, but without an overbearing state that removes the necessary private reward to effort and innovation.' A stakeholder view of business was needed, 'recognizing the other parties involved beyond the shareholder perspective'. 

In the online discussion which followed, Geoffrey Lean, doyen of British environmental journalists, countered that the business community was often leading the way in green innovation, in the light of the climate crisis.

Discussions like this, where idea generation is fuelled by diverse perspectives, is what makes IofC B&E unique. Do you have a mind for business but a heart for making the world a better place? Then participate in the next in the series of discussions, to take place on 12 March. Register today and keep in touch for more information on how you can lead the way in your own organization.