If anything, John Elkington’s now immortalized sustainability framework of “People, Planet, Profits” has become increasingly central to corporate strategies. To my thinking, successfully integrating environmental, social and governance (ESG) concerns into business & investment decisions; contributing time, money and human intelligence to establishing smart, safe and sustainable practices, promoting diversity, equity and inclusion (DE&I) agendas for positive impacts, and embracing innovative practices and technologies in ways that are resilient and responsible all fold into the larger idea of this “triple bottom line.”
How do these tenets fit into the new electric vehicle industry? Is there a business case – and I strongly believe there is – for electric vehicle companies taking the lead in embedding sustainability, inclusivity and governance objectives into their vision and practices?
From Zero Emission Vehicles to Net Zero Organization – Zero, Zero, Zero
We’ve all seen enough of the three evils of traditional fuel powered vehicles – air pollution, congestion and road fatalities – to know that carbon neutral transport is the only way forward. But I am convinced that we, as an industry, should be setting our sights much higher than just producing zero emission vehicles. Quite frankly, that’s low hanging fruit. Instead, we should be – and I am happy to state that we already are in the case of my new company, Switch Mobility – turning our ambitions to achieving net zero operations across the board.
What does this imply? For a start, it means ZERO carbon use while manufacturing zero emission vehicles. It means ZERO carbon to power these vehicles, replacing them with green energy. It means ZERO carbon functioning of our factories and offices, swapping over to renewable energy sources. It means ZERO carbon applications in logistics; moving to clean, environmentally-friendly freight movement. It means ZERO carbon supply chains defined by carbon neutral operations from start to finish, culminating in end-of-life reuse and recycle practices. And, it means striving towards a ZERO carbon footprint by building circularity in products and services design, development and delivery.
Someone Please Call Mary Barra
One of my articles on Women in cars cited a 2014 Frost & Sullivan study which found that, contrary to popular belief, more women in the U.S. had driving licences than their male counterparts. Seven years later, this trend still holds true which makes it all the more surprising that the automotive industry still makes a very ‘masculine’ product targeted towards male drivers.
There is a second aspect to such social biases, and that is that women executives remain hugely underrepresented in the traditional, male-dominated automotive industry. There are exceptions of course: Mary Barra, CEO of GM, (a strong votary of ‘Zero Crashes, Zero Congestion, Zero Emissions’), Linda Jackson, CEO of Peugeot, and Pamela Fletcher, VP of Global Innovation and Research at GM who oversees the engineering teams behind the company’s global portfolio of electrified and autonomous vehicles.
In short, achieving meaningful workplace diversity, inclusivity and equity remains a work-in-progress targeting as it does improved and more diverse representation at top management and Board levels, non-discriminatory hiring practices and pay parity.
The one shining example in this space is GM whose CEO and CFO were both, at one point, women. It has that automotive industry rarity, a female majority Board. GM has featured in Bloomberg’s Gender Equality Index (GEI) for “transparency in gender reporting and the advancement of women’s equality,” ranked first in Equileap’s 2019 U.S. report terms of gender equality, and was the leading automotive company in JUST 100’s ranking, based on “public attitudes toward corporate women’s equality.”
For good measure, it featured on a 2021 list of “World’s Most Ethical Companies,” which brings me to the thorny issue of ethics, regulatory risk and governance.
Someone Please Don’t Call Elon Musk
Ideally, what one would want is strong corporate governance and regulatory compliance to back ESG and DE&I agendas. But in real life that’s not always been the case. Corporate governance (or the lack thereof) has been in the recent spotlight both at Nikola Corp, the electric truck company, and at Tesla.
In May this year, Tesla temporarily stopped accepting Bitcoins from customers to purchase its cars, with Elon Musk citing concerns over the world’s largest cryptocurrency’s highly energy intensive mining operations.
On the flip side, however, has been Musk’s troubling corporate governance legacy. Shareholder interests have been repeatedly undermined by the perceived lack of regulatory compliance. Tesla’s Board has been pilloried for its lack of independence and diversity (who can forget Musk’s controversial 2018 Tweet about taking Tesla public and having secured investor funding which landed him with a $20 million fine).
Fixing corporate governance, therefore, will be a priority, if budding electric companies are to maintain their reputation and performance over the long-term.
Switching To The Right Approach
The recent appointment of Dr. Miranda Brawn to the position of Independent Non-Executive Director (iNED) at Switch Mobility’s Corporate Board brings together these interlinked strands: carbon-neutral transport solutions, corporate governance, regulatory and risk management, and DE&I and ESG agendas.
In a freewheeling discussion, Dr. Brawn shared her views on how the electric vehicle industry can spearhead DE&I and ESG agendas as part of the larger sustainability charter. She emphasized that electric vehicles, which are inherently carbon-neutral, are the future of mobility and will be key to combating climate change challenges. That said, the mobility ecosystem will need to embrace every aspect of sustainability in order to realize socially, economically and environmentally coherent practices and create real, long-term value.
Talking of the importance of embracing sustainability from a holistic perspective, Dr. Brawn highlighted that ESG-driven investments into clean technology solutions and environmentally conscious practices represent only one side of the sustainability coin. The other is DE&I which leads with socially inclusive and equitable approaches, backed by governance commitments.
Elaborating on this idea, she added that actively encouraging work force diversity –whether in terms of gender or race, disability or sexual orientation – across all levels of the organization, particularly at top decision-making levels, can strengthen resilient & responsible, collaborative & creative, inclusive & innovative growth.
For Dr. Brawn, the idea of inclusiveness extends even further to developing products and services that are suitable for all. This could, for example, inform the designs of next generation vans and buses that can be driven by both men and women and by both old and young. For the perennially driver strapped commercial fleet industry, new vehicle design and technology could encourage a new legion of drivers, young and old, to get behind the wheel. Switch is already working towards this goal with the new vehicle design & engineering of its next generation vans.
Dr. Brawn sees technology as catalyzing other positive social impacts in the form of in-vehicle advanced driver assistance systems and health, wellness and wellbeing features that targeted greater comfort, convenience and safety for vehicle occupants/drivers based on their individual, rather than any perceived collective, needs.
Imbuing The Singularity With An Ethical Core
As the electric car industry reaches singularity with autonomous vehicles, corporate narratives will necessarily change. Perhaps, at that stage, electric vehicle companies should consider inducting humanized AI bots/digitalized humans/machines with a soul (call it what you will) onto their boards as Directors. My only recommendation on this score would be that they have a Ph.D. in Ethics as well!
Switch, an EV Company in UK Leads the Agenda on ESG
Source: Switch