Corporates and countries, which often stand in competition with one another, should recognise that collaboration is the best way forward, says Darian McBain, founder and CEO of Outsourced Chief Sustainability Officer Asia (OCSO Asia).
“You could be the best large listed company in the world. But if you haven’t brought all of your suppliers and your supply chain along with you, you actually can’t meet your own decarbonisation goals or any other sustainability goals.”
Helping business partners along will likely be a global exercise, adds McBain. “Very few supply chains now are entirely local; most of them will go across borders.”
Likewise, countries need to accept that overcoming the effects of climate change is a shared responsibility, she says. “You can be a very rich nation, and within your own country, you can do a lot for adaptation and perhaps mitigation, but climate change will impact everybody.”
Everyone has to take responsibility for their portion of the problems, says McBain. “How you proportion that, of course, becomes very political. But I think the first step is that everybody must be willing to contribute to the solutions.”
At the ongoing 2023 United Nations Climate Change Conference, or COP28, governments are working out the details of a “loss and damage fund”, which is intended to pay poorer countries for the harm caused by climate change.
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Speaking to The Edge Singapore at the Singapore Fintech Festival (SFF) 2023, McBain compares this to a similar concept by the maritime industry. “Many years ago, I worked for the International Maritime Organization (IMO) with the International Oil Pollution Compensation (IOPC) Funds. That is a fund where all the member states who are parties to the conventions would put funding, [and] when there was an oil pollution spill, the funding would be allocated.”
The IOPC Funds have been compensating victims of oil pollution damage since 1978, and are financed by contributions from entities within member states that receive certain types of oil by sea transport. These contributions are based on the amount of oil received in the relevant calendar year, and cover expected claims, together with the costs of administering the Funds.
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Unlike the IMO, the IOPC Funds are not UN agencies and are not part of the UN system. Since their establishment, the 1992 Fund and the preceding 1971 Fund have been involved in over 150 incidents of varying sizes all over the world, and have paid out some GBP752 million ($1.268 trillion) in compensation.
The beauty of the process is that everybody meets in person once a year and agrees on the way the funds are being allocated, says McBain — providing a “collegiate approach” to resolving problems with contribution and compensation.
The annual COP has yielded “strong ties” between different countries, says McBain, and each state has the opportunity to present their own particular challenges. “You have the small island developing states, the industrialised countries [and] the oil-producing countries; it’s a great platform to bring everybody together. What I would hope to see is more work on the loss and damage fund and how developing and developed nations — or richer and more at-risk nations — are going to work together for the shared responsibility [of] solving climate change.”
The ‘fractionalised’ CSO
In January, McBain started OCSO Asia, which offers a service for organisations seeking sustainability advice without hiring a full-time chief sustainability officer (CSO). Prior to starting her firm, McBain had served for over a year as the Monetary Authority of Singapore’s (MAS) first CSO.
She joined MAS in October 2021 after six years at Thai Union Group, the world’s largest seafood producer, where she was global director of corporate affairs and sustainability.
During her time at Singapore’s central bank and regulator, McBain repeatedly heard about a “skills gap” with sustainability. “People would ask me: ‘How do we clone you? How do we get more people who have experience in sustainability in this region?’ Of course, the answer is we’re not cloning people as yet. But I came up with the idea of a fractionalised CSO, similar to a chief investment officer who may work for different investment funds.”
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The “fractionalised” CSO uses her experience speaking with boards and C-suite leaders to help build sustainability capacity within these organisations. Among McBain’s clients is Elevandi, the not-for-profit entity set up by the MAS in 2021 and co-organiser of the SFF.
“It’s been going well; I’ve got some great clients. It’s interesting to see how different organisations see their priorities — some face more operational issues, some see reputational issues. I think all companies are at different stages,” she observes.
How does McBain’s work differ from a regular consultancy? She prefers to work with organisations over the long term — “say, a year-long contract” — to understand businesses better.
“A consultant usually comes in to deliver a particular project, like writing a sustainability report, whereas I’m there as an adviser over the years, through the ups and downs, to really be part of the team as the CSO would. But rather than sitting in their office every day, maybe I’m there once a week or for particularly big events.”
McBain recommends strategies, services and tools depending on her clients’ needs. “If a client wants a carbon accounting platform, for example, maybe I will speak to someone like [Singapore-headquartered decarbonisation platform] Unravel Carbon and bring them into the team so that they have that technological expertise. From my experience as CSO in organisations, that is how you work; you go out, find the expertise and bring it in. But you have one person who is looking at the big picture and the strategic direction of the organisation.”
Follow The Edge Singapore’s coverage of COP28 here.
