Podcast: Using ESG’s Value to Drive Positive Change in Tech
CPABC hosts a Coffee Chats with CPABC podcast series that shares insights from BC’s chartered professional accountants and other subject matter experts.
In the most recent podcast episode, CPABC’s President and CEO Lori Mathison, FCPA, FCGA had a conversation with Zahra Kolia, CPA, CA (SA), Vice President of Finance for Copperleaf. They discussed the role of the tech industry in the global path to greater sustainability, and what ESG-related areas tech companies are focusing on. Zahra shared some key insights on the ESG-related areas Copperleaf has invested in, and how these efforts benefit the company, its clients, and beyond.
Find the full podcast episode on the CPABC website here and the transcript below. You can also click here to download our complimentary ESG playbook on how to operationalize sustainability and deliver results in your organization.
Lori: Could you expand on what Copperleaf does and your responsibilities there?
Zahra: Copperleaf is a Vancouver-born tech company; recently, we were acquired by IFS, a UK-based software company. We help our clients with large-scale assets and critical infrastructure to optimize their capital allocation and decision-making, ensuring our clients get the highest possible return for every investment they make in their business. I lead our finance team, taking care of financial reporting, internal controls, revenue, accounting operations, tax, and treasury. Over the past two years, I’ve added a few more hats to my role, and that included leading our ESG program and looking after our enterprise risk and governance.
Lori: What are some of the unique ESG impacts that tech companies can make when they implement their own ESG initiatives?
Zahra: Something truly special about the technology industry is that it’s fast-paced and transformative. We’re able to implement and scale ESG initiatives in ways that other industries might find challenging. One of the most significant contributions tech companies can make is through sustainable approaches when we are coding and developing software, by designing products to minimize data processing and server usage. By optimizing energy use, we can reduce our industry’s environmental footprint. On the governance front, developing and using AI ethically is crucial; this can involve, for example, creating transparent and accountable leadership structures and proactively adopting best practices.
From the social perspective, technology has an incredible power to bridge the digital divide and create a more equitable and inclusive world. In doing so, we can bring education, healthcare, and economic opportunities to underserved communities – even things like affordable internet access and digital literacy programs can empower individuals and uplift communities. Internally, if tech companies foster inclusivity and diversity, we can make sure that our innovations reflect and serve a global perspective. Together with bridging the technology gap, these kinds of commitments will help us create a more equitable and inclusive world.
Lori: What ESG-related impacts are tech companies best positioned to make?
Zahra: Without a doubt, technology has changed each of our lives. It’s essential that technology companies prioritize the right things so that their influence on our collective future is positive and ethical. Ethical AI and data privacy are paramount. Tech companies are custodians of vast amounts of data and powerful algorithms, so there’s an inherent duty to ensure that we use these technologies responsibly and equitably. We can achieve this by developing AI that is free from bias, protecting users’ privacy, and being transparent about how we use data.
Lori: How does Copperleaf help other companies address ESG challenges?
Zahra: At the heart of Copperleaf’s solution is our value framework. It allows our clients to define what value means to them and to evaluate both quantitative and qualitative, or financial and non-financial, factors on a common economic scale. In other words, our clients can compare apples to elephants when they are making a decision. This means clients can integrate ESG factors into their value framework alongside their other objectives. When they make a decision, they can account for the ESG criteria, use them in business cases, and value their plans consistently. This approach enables all of the stakeholders involved to understand the rationale behind each investment and how decisions contribute to their high-level goals.
For example, if a company is deciding between two projects, one that offers a high financial return but has a significant environmental impact, and another that offers a moderate financial return but significantly benefits the community, our value framework can help them quantify and compare those diverse impacts on a common scale, making it easier to choose the option that best aligns with their overall goals and fits within their different constraints.
Lori: Does AI play a role?
Zahra: Copperleaf’s technology uses AI to quickly generate investment plan options, identify the highest value ones, and rank the options based on how our client has defined value. On top of this, our AI makes sure that the ranking considers our client constraints, including their budget, available resources, and project start date. All of this helps our clients make an informed, optimized decision on how to invest and move forward.
Lori: You’ve worked to align Copperleaf with responsible business practices. What did you focus on and what was the impact?
Zahra: First and foremost, we established a robust governance structure to oversee ESG and established an ESG steering committee. One of the first things that the steering committee and I undertook was defining our ESG strategy, which set the foundation for all of our efforts and helped us balance business objectives, stakeholder expectations, and our long-term sustainability goals. One critical area of our strategy, and something that’s really close to my heart, was diversity, equity, and inclusion (DEI). Fostering an inclusive culture is essential for innovation and reflecting the communities that we serve, so to this end, we developed a DEI philosophy and created a long-term roadmap with goals and milestones to guide our initiative, including enhancing our data collection around employee demographics, better training people on DEI, and targeting our recruitment efforts to enhance the pool of candidates we have before we make a hire. This DEI roadmap rolls into our ESG strategy and our ESG strategy is integrated into our overall business strategy.
Lori: With your leadership, Copperleaf published its inaugural ESG report in 2023. What key reporting areas and metrics did you focus on?
Zahra: In the governance section, we detailed how board and executive roles tie to different parts of the ESG program and provided insight into our enterprise risk management program and our approach to climate-related risks and opportunities. We also provided information on our digital security and our commitment to protecting data and mitigating cyber risks. On the social front, we highlighted Copperleaf’s culture, discussed our DEI strategy, and showed metrics like employment engagement scores, diversity ratios, and the dollars we’ve invested in learning and development, as well as giving back to our communities. And on the environmental front, we reported our carbon emissions using the greenhouse gas protocol. We published scope one, two, and three emissions, detailing our activities to reduce them and offset them where they’re unavoidable.
Lori: Looking ahead in the tech space, what ESG developments do you have your eye on?
Zahra: One is the growing awareness around the environmental impact of AI and the substantial amount of energy it uses. As AI technologies become more integrated into our lives, it’s important that we consider the environmental footprint. AI systems, especially those involving deep learning and large-scale data processing, consume a huge amount of computational power. This, in turn, leads to high energy consumption and often that energy consumption is coming from non-renewable sources. The environmental impact of training and running AI models can be substantial and is contributing to increased emissions. I’m hopeful and excited that we are going to see advancements toward greener and more energy-efficient AI technologies that will enable it to contribute positively towards sustainability.
Lori: Finally, are there any ESG-related resources that you’d like to recommend?
Zahra: When I started my learning journey on ESG, courses from CPABC were helpful. I also worked quite closely with EY as we undertook our first ESG report and their Beyond the Bottom Line series has a lot of useful information. Currently, I’m taking a certification on climate leadership from the Diligent Institute, which will help me better oversee climate risk and create sustainable growth strategies at Copperleaf.
To see how Copperleaf has helped organizations around the world with incorporating and making progress toward ESG objectives, check out our complimentary ESG playbook and this video interview with Anglian Water from IFS Unleashed 2024.
Zahra Kolia, CPA, CA (SA), is the Vice President of Finance at Copperleaf, an IFS company. She has led Copperleaf’s Finance team through significant milestones, including a $160-million IPO and the closure of the company’s acquisition by IFS. Zahra is also committed to aligning the company with ESG-related business practices, and is passionate about mentoring the next generation of Finance professionals.