And we appreciate your time with us today and joining us on the call today to discuss your expertise on ESG and sustainability. So starting off, could you please introduce yourself, talk a little bit about your company, the work you do in the ESG space. We would love to hear that.  Sure. So as you said, I’m Sneh Kumar.

I have the responsibility for sustainability and ESG for Arconic’s building and construction business. Arconic is a large aluminum based downstream product supplier. And on the building and construction side, we go to market under a brand name Kawneer, which is a leader in providing building facade products based on aluminum in the commercial construction industry in North America and in Europe, and my responsibility is to set the strategy for our sustainability and ESG as well as execution of that strategy for our business in both North America and on the Europe side.  That’s awesome. So given that it’s a completely different space and I think it impacts a lot of the real estate industry directly and your role, what specific role do you play?

Do you bring strategies to different companies internally or to your group of companies or outside? How do you interact with them? Yeah before we jump into it, let me just set the stage of why building and construction is important from climate change perspective and resource use perspective. 40 percent of all greenhouse gas emissions come from of the building and construction industry. We hear a lot about electric vehicles and transportation side, but that’s responsible for 22 percent of the global greenhouse gas emissions. Buildings are the largest culprit if you want to call it. So we work in that industry and it’s our responsibility to drive down the emissions from the building and construction sector, and when you look into the where that 40 percent comes from, it’s around one third of that, around 13 percent comes from the building materials. And the rest of the mission comes from the operation side of the building.

So heating, cooling and maintaining the building once a building is built. When we look at how we impact with our product we are looking to holistically reduce the overall carbon footprint or emissions associated with the manufacturing of our product. How our products are used during the operation as well as what happens to the product at the end of their life cycle.

So we are trying to look at the full spectrum and trying to develop the strategy where we can offer market leading products, innovative solutions to help reduce the embodied carbon, the operational carbon as well as enable end of the life reuse of the product and the material.  That’s awesome. First of all, I should say kudos to you and your organization for acknowledging that the building and middle material are one of the biggest culprits of carbon footprint and taking an initiative to reduce that very consciously.

So kudos to you and your organization for doing that. You were talking to us about the different aspect of carbon footprint, where it comes through from a circular economy perspective and how you’re trying to reuse it throughout the cycle, from its inception to when it’s discarded.

So specifically what can you speak a little bit about, building material and how carbon footprint is involved and what can we do as consumers to reduce it, as an educated consumers, because I think it’s not as you said, not many people would be aware of that. So what can we do when we may be choosing building materials  or asking for it even, correct?

I think one is awareness. So what would you speak to that? On the building material side, the selection of the building material as an end consumer, a lot of time we don’t have the say. Buildings are designed, if you look at by architects and the designers and built by general contractors.

And they are the key people who have the onus of selecting the right material which has the lowest life cycle impact. When you start understanding, okay, what material you use, what’s the embodied carbon of it? What’s the operational impact of it? And also how’s the durability of that material?

Is that material going to last you for 10 years versus 30 years or 40 years? That plays a significant role of, like, how much material are you going to be needing it? And then also what happens at the end? Can it be reclaimed, reused, brought back into the economy? Or is it getting wasted and going into the landfill?

Architects and the building designers are central to selecting and picking the appropriate materials and the products to design their building and optimize it from the overall life cycle point of view. Obviously, there are cost impacts. There are other constraints.

There are design constraints. You have to meet, you know, building codes. You have to meet certain performance criteria. There are aesthetic elements that needs to be taken into account. It’s the architects and the designers job to like juggle all these priorities at times, which are competing priorities and come up with the best possible solution for their building design and try to minimize the overall environmental impact of the building.

But can, as a conscious consumer, can we push these at the level that you’re talking about, whether it’s the architects or the contractors or the people who are constructing big projects like homes as such? Because I know in India, we are going back to our old technology of building materials like clay.

We are trying to make houses from sustainable living from that. I was at an ESG conference and I met an organization that makes cement, but they are looking into research and innovation where they’re looking, as you said, to go back to reclaimed building material from old buildings, and then composing it with the chemical compositions of cement to talk to how can this be extended, or can they be mixing it to give the same consistency as what the original cement manufacturing formulas could have been.

So I think there’s a lot of innovation that is happening. There’s a lot of thought leadership. There’s a lot of insights that’s going into it. And I think it’s important that the consumers need to be aware of it, at least to ask for it, correct? So you’ve said a lot about, durability. You’re talking about sustainability.

You’re reclaiming. Is those efforts happening here? And is your organization involved in it? Can consumers reach out to you to learn more about it? Is there like a webinar that you’re hosting or if there is, people in the real estate industry, can we push them or give references to that? 

Yeah we do a lot of education for architects. So we call it like AIA courses American Institute of Architect has guidelines on educational courses we have a multiple of those which we develop and we provide education to architect. So we play in the commercial construction sector, not directly connected with the consumer, but we design our products with the end user in mind. So we do a lot of webinars and events to educate architects about our products, how they perform, about the sustainability, environmental impact criteria, how they can design buildings which are having helpful for the occupants, taking care of the occupants from thermal comfort from performance of the building point of view. So we do a considerable amount of architectural education as well as advocacy in the industry for things which can drive our industry forward. Is there any particular seminar or something that you would like to speak about or reference? 

Definitely if you go on our website to the listeners Kawneer.com, you can find links to our webinar. We also post several of our webinars if you are not able to join it you can go through it at your own leisure.  We do share those information and also on our LinkedIn and social media pages. If we have events coming up, webinars, or any other educational sessions, we try to make our followers aware of those opportunities. So coming to technology as a technologist, I think that’s another dimension that I’m very interested in.

So what are you doing in the ESG and sustainability space? Do you all have ESG sustainability annual reporting? How do you gather your data? Do you have tools that you work with that provides you the measurements on the metrics for you to constantly improve. I’m assuming that’s taken into account as you build your strategy from year to year, and you have targeted goals because you seem to be so well aware, one, as you said, what is the problem and then also working towards investing your time and effort in solving for it.

So given that, how does technology help you through that process? So obviously, sustainability is evolving and evolving rapidly, and we are all trying to keep pace with it. And when I took this role more than 12 months ago, my focus was again trying to understand from all our stakeholder where, Kawneer should be going.

What is the direction we want to go? Kawneer was founded by an architect back in 1906. And he was designing a storefront where wood was the primary material at that point. And before the building was finished, he saw the material was already rotting.

And he started thinking there must be a better way to design these better material, which are more durable and sustainable and he iterated with different material and he landed up on aluminum and aluminum has since then remained the choice of the building material for the building envelope products.

And obviously, we have continued innovating around aluminum to try to keep up with the requirements and continue to show progress where, there is confidence of the architectural community to use aluminum based framing system. So when we look at our journey we have been a sustainable product provider throughout, and we have continued to innovate to provide sustainable products.

And in the last few years, what has happened is, it’s not just about the product and the performance of the product, but also as a company what are we doing to address some of the big challenges, as you mentioned in our society? From climate change, from lack of circularity  in overall biodiversity, I’m sure that’s directly impacting that.

Yeah, and then also we have our earth overshoot day where we are using more and more natural resources than we should be using. On the social side, there are a lot of people still working in unsafe condition as well as not being paid fairly under forced labor conditions.

So there are 28 million people who are still under that. So what as a company we can do beyond continuing to provide great products. So we looked at our strategy and we have come up with our sustainability goals or ESG goals where we are trying to convey to, architects and others in terms of our goal around three pillars – planet, people and product.

On the planet side, we have made commitments that Kawneer will reduce his greenhouse gas emission intensity by 40 percent by 2030. so our scope 1, scope 2 and scope 3 we are looking to get that down by 40% to align with the Paris Climate Agreement to stay aligned with the 1. 5 degree centigrade pathway.

On the people side, we have instituted supply chain sustainability where we are looking at ourselves as well as our key suppliers and making sure we are not just us, but our suppliers are honoring human rights, paying fair wages, and those kind of things.

So that we are not enabling forced labor or we are being fair. We also, have a goal around the diversity to have 35 percent women in our salary position. We have employee resource group inside where we are trying to give voice to everybody, have everybody welcomed and feel part of the team.

So we have taken several steps. On the people side and on the product, obviously we have been known for our products. Kawneer is a beloved brand by the architects. And as a steward of Kawneer we are trying to continue to enhance and accelerate our journey around products we provide by reducing the embodied carbon.

Improving some of the operational performance as well as continuing to innovate to solve the problems to meet the needs of the architectural industry. Thank you for that. But are there any tools that you’re using for that as a company wide tool? Do you have a centralized platform where these goals are measured, inputted on an ongoing basis?

And also I love the fact that you’re looking to, bring your thought process to your supply chain, because I think that’s one of the biggest challenges that we face within ESG and sustainability is how do you one communicate? How do you hold your suppliers accountable by the same values that you run as an organization and then holding them accountable for the same?

So I would love to hear a little more about that.  Yeah, so definitely. We have our values and we want to do business with people who understand our value and are similar in terms of aligning with their business practice with our values. That’s basic for us. If you want to do business with us, we have certain expectation.

We have supplier code of conduct as well as other criteria where we are looking to hold ourselves accountable, but also our suppliers. So do you do this? Sorry for interrupting, but do you do this through contracts? Is that how you enforce it? So a couple of ways. One is obviously the contract, but we have also you mentioned about the technology.

So we have a supply chain sustainability management platform. EcoVadis is what we use right now where we have undergone our assessment and we are bringing in our key suppliers to have the questionnaire done, their assessment done by the third party. And I forgot to mention one of our sustainability goal is to have 50 percent of our purchase from suppliers who have undergone supply chain sustainability assessment by 2025.

And that number goes up to 80 percent by 2030. So we are bringing in more and more of our supply chain within the sustainability management, which would help not just us improve, but also our entire network of value chain. That’s awesome. It’s wonderful to see that your priorities are so set.

So I’m thinking that the tone at the top has been set very well. And you have a lot of commitment from your board, from your senior leadership, executive leadership, from a strategic end of a vision perspective in ESG and sustainability. That’s wonderful to see that the company has that kind of support.

So thanks for sharing that. Moving on to the next one, I would love to hear, I think when we had spoken earlier, you were talking about circular economy and, circularity from a perspective of what you do as an organisation. So maybe you can share what you’re doing from that space from its inception, especially when it comes to recycling waste or repurposing, reducing some of the raw material that probably goes into making of your products.

I think that’ll be a great highlight for us to listen into.  Yeah, so as I said, lack of circular economy is a challenge for us. It’s estimated only 7.2 percent of the world economy is circular. So think of it, we extract resources, we use it, and we throw that material back in the landfill or it’s unusable.

And aluminum is an exception to that. While the economy is only 7 percent circular it’s estimated 75 percent of aluminum ever produced is still in use. It’s an exceptional material from its properties point of view, where it can be fully recycled and reused at the end of its life.

We are fortunate that our products are based on aluminum and aluminum gives great advantage to us on being a circular product offering. Obviously we have other ingredients, but aluminum is the key material on which our products are based. And obviously we are looking to increase the recycle content off the aluminum and aluminum gives you great durability. We have products which can have 30, 40, 50 year life. So you don’t have to replace it. Aluminum is easy to maintain. So the cost of maintaining is very low. And at the end of the life it is estimated that almost 90 percent of the metal from the building and construction gets recycled at the end of their life.

So think of it when world economy is only 7 percent circular metal use in the building is an exception and, because it can be melted and reused at that point. Yeah. But I think there’s still opportunities like water use, correct, in production of it or it could be in the operation aspect of your manufacturing units, correct, whether it’s using solar power or it’s using natural energy, renewable energy.

So are you all doing any initiatives around that to support the circularity, from that perspective, or even reclaiming and using as I said, I give you an example from the core material itself. I don’t know if you reclaim something and you use that in making an innovating products for the wrong.

What I can share is pretty much, all the aluminum which kind of comes out as waste in our operation, in our manufacturing operation, everything gets back into the economy. We send it back to a cast house where they get remelted and reused. Pretty much if you think of our landfill waste or basically non useful waste is a small, it’s one of the by product of one of the finishing processes.

But all the other aluminum waste pretty much goes back into the economy through the collection. So we have a closed loop contract with our aluminum billet supplier, where whatever is the extrusion, which is one of the main processes, or any of the other process waste, we send it back to them and they are able to reuse it.

And you also previously asked about some of the emissions, how we are looking to reduce. So when we looked at our strategy, obviously scope 1, scope 2, they are much smaller portion under 10 percent of our overall emission. And scope 3 is the elephant.

Yeah. So we have a strategy in place where we are trying how we can get to the 40 percent reduction in our greenhouse gas emission and scope 3 is a big part of that. We are aware of opportunities around scope 1 and we are looking to operate more efficiently and look at the energy efficiency opportunities and put those in place.

And scope 2 is more electricity related. Grid is decarbonizing.  But again, we know what are the technology options in terms of the renewable electricity purchase and those kind of things. So we are not actively chasing those. But again, we are aware of opportunities as we need to reduce the scope to emission and scope 3, which is the biggest one for us and also the most challenging is tied very strongly with the type of aluminum we buy and aluminum has a wide spectrum of carbon footprint if you look at globally it can vary from, 0.5 all the way to 25 ton of carbon per ton of aluminum. So we are trying to move to the spectrum where we are using lower carbon aluminum as a standard product offering for all our products and make the maximum impact in terms of offering low embodied carbon product to our customer. So we have set a standard where we are buying aluminum with minimum 50 percent of recycled content and the remaining prime or the new aluminum which makes that billet comes from hydroelectric or clean energy source.

So again, for each of these sustainability pillars we have a road map in terms of how we are going to achieve our targets. And we are  publishing that as part of our parent company, Arconics ESG report where we are disclosing our emissions scope 1, scope 2, scope 3 based on the GRI standard to convey how we are making progress around these goals.

Coming to regulatory changes, you just touched on GRI. So is that the only framework that you kind of aligned right now? And given that the global frameworks are changing, how do you sense and how are you setting yourself up? Because there is so much of variation, because as you said, it’s still evolving.

So we have not yet come upon standardization. So how are you all dealing with that as a company, especially because you’re working across suppliers and those suppliers could come from non Americas. Base. And then if you’re in Europe, you have a lot more stringent rules. If you’re an issue pack, I think that’s another area where it’s evolving and people’s priorities are there.

Also, one area I would love for you to touch is if, is any green fund investments that maybe the company is either making into because you’re such a conscious ESG and sustainable company, are they something that you’re looking into and you would advise the customers or the peers who are listening to us to think in those directions?

Yeah, so some will call it regulatory tsunami around the sustainability or ESG is happening. And that’s one of the key part of our key responsibility to keep up with it and figure it out how we’re going to comply with it. So GRI and CDP, those are the two standards right now.

Carbon disclosure side we do on the emission side. CSRD has been announced. And we will have certain locations which has to comply with that. We are still working to figure out our strategy of how we will report on the CSRD side which is a European mandate.

And then there are other regulations I didn’t know if you’re familiar with. CBAM, which is Carbon Border Adjustment Mechanism. Yes. So it’s more of a tariff for incoming certain materials and aluminum is one of them. We are working towards making sure we are addressing that as well as our customers who rely on us are able to get that information from us here in United States. You’re probably familiar with the California’s requirement on the emission side, SB 2 53. Again we are looking at all these regulatory requirements and trying to be prepared.

There are also product specific requirements in United States and also in Europe. Building codes, buildings are highly regulated product if you want to call them and the regulations has energy codes have primarily focused on the operational side of things.

So you need certain installation in your wall. You need certain installation in your roof. So our products, we call it you factor, which is inverse of our value or insulation value. So we have certain requirements around those. And they have focused mainly on the operation side, but as we learn more that, hey, one third of the building emissions come from the building materials and embodied carbon, there are a lot of regulatory movements happening on the embodied carbon side of things also.

On select material, US government is piloting, USEPA is piloting some of the programs of buying lower embodied carbon material such as steel and glass. That’s coming. That’s in the pipeline. There are standards being developed around how buildings could be regulated around the embodied carbon content of those things.

And then there are voluntary standards. You may be familiar with the US Green Building Councils lead so buildings get rated for the LEED. There is living building challenge and these are voluntary standards, but they have points and the requirements which mandates you to meet certain criteria on embodied carbon, operational carbon, recycling content and those kind of things.

So we provide guideline of how our products can contribute to making green building or yeah. That’s also keeps evolving. So as we learn more and as we try to address these big global challenges, these standards evolve to keep up with the requirements. So there is a new LEED v5, which is in the developments right now is coming up later in the year, which is going to focus a lot more on the embodied carbon since it’s been somewhat neglected it’s going to focus on the overall life cycle.

We try to again prepare our product and develop information about our products. So it can help architects or building designer understand how our products would impact the LEED rating. The green certifications. Yeah. Yeah. This is a lot. I think you all are doing phenomenal in bringing all of these frameworks together.

So it’s actually, it could be a nightmare as well, trying to meet all of these regulations and we are trying to also work with moving away from greenwashing. So what kind of a team do you have, an organizational team that supports these kind of regulations, make sure y’all are up to speed with all the regulations making sure y’all don’t have compliance fatigue, because just listening to all the regulations that your organization is trying to meet It should be to address the lowest common denominator and then do the deltas so that the organization doesn’t have the compliance fatigue, correct?

So do you have an organization that supports it? How are you all supported? So you do it once, but applied many times as well as extended to your supplier chain, compliance that is needed there. Yeah, so one of the ways of how we have thought about is rather than making a vertical around sustainability and ESG we have tried to make it horizontal and try to embed it into each of the existing function for example, on the procurement side, on the EHS side, on the product design side and embed what are some of the requirements into our day to day operation and try to make it part of your regular or daily operation rather than having, separate, separate team members.

It’s still an afterthought, but it is part of your life cycle. Yeah, so that, that’s how we are designing and integrating sustainability into it. Obviously we have a corporate team where we work more on the corporate reporting side of things just gathering data and all that.

And that’s where somewhere we are trying to look for some technology help. We currently don’t have a ESG platform. We are looking to integrate that so that we can overall improve our process and gain some efficiency in terms of corporate ESG reporting.

But from overall trying to manage ESG and sustainability it’s always increasing as we think the regulations are coming more and more customers are asking for information about it. And again, we are trying to anticipate and try to stay ahead.

But again it’s a team effort across all these different functions within the organization to keep up with it. I think it’s a global responsibility at this point in time, correct? Each of us play a responsibility to it. That’s phenomenal, it is good to hear that sustainability is not an afterthought, but it’s imbibed into every action that you guys do, and that you are doing very well with it.

So thanks for those insights. Last question about any product developments, R&D that you’re working with, any strategies that you are using to engage with your customers  and any future trends that you want to touch on as we come to the end of this podcast.

Yes, so again we exist to provide products to our customer and we spend a lot of time trying to understand the need of our stakeholders. So I mentioned about architects, building designer, our customers who are taking our product and installing it on the building. We spent a lot of time with them to understand their need, understand any gaps, understand opportunities to improve our, product offering.

That’s that’s one of the important a guide for us of what to develop next. And, what has come out of those from sustainably point of view is obviously we want to reduce the embodied carbon of our product. We have, sourced lower carbon aluminum. We are looking to have environmental product declaration, which is the EPD.

So we are looking to figure out how we can procure the materials with lower embodied carbon and provide them with the product to have a minimal or a lower environment impact similarly a key part of our product innovation has been around improving the thermal performance of our product or energy performance of products where our products are more and more insulating and they can reduce the operational side of things.

Of course, we are looking into a design of our products of what happens at the end of the life and how it can be disassembled. So different materials or different nutrients some may call it can go back into the economy in a convenient way. So all that comes into is reducing the overall environmental impact of our product and increasing, a full circular product so that we are addressing the larger challenge as well as meeting the needs of our stakeholder.

So what I call that is a holistic sustainability view where you’re not, you know, fixated on just one aspect, but we are thinking completely. And that’s what we encourage you know, architectural community to think is not just embodied, not just operational think of the overall life cycle impact, think about the durability of the product, think about what happens at the end of the life of that product, whether it goes to landfill or comes back into the economy.

Think about are we respecting human rights in our value chain? Not just us, but entire value chain. So take all that into account as you select the product as you design your building so it’s not just about a great product, but also which company are you buying it from? Is the company committed to solving some of these challenges?

I call it like holistic sustainability framework for the product as well as for the company and try to take that into account as they select the product. Wonderful. I think it was a brilliant talk, you covered the holistic sustainability model. You actually gave evidence of how you’re doing it at each component of people, planet and, from your aspects of your three pillars.

It’s good to hear a company that is so holistically involved, thinking so from a vision perspective. It’s just not you, but also your suppliers looking at future innovations that are coming through, looking at recycling aspect of it, the people aspect of it, making sure that your suppliers are also going by those values and also giving pointers for, somebody who’s looking to do more business in similar areas.

How could they get engaged in this kind of a holistic sustainability model? I think there was a lot of great learning from you, Sneh. Thanks for sharing this with us. Thanks for your time. Any last words before we sign off? Again, I would say check out our website to learn more. Follow us on LinkedIn.

We are on social media to track our progress. And I’d love to again, hear back any feedback you get from your listeners and others. And again, I want to thank you. I’ve enjoyed talking to you and sharing what we are doing. And thank you for having me.  Thank you, Sneh.

Thanks, everyone. Thanks to our guest. This is Sailakshmi from Amazech, Head of ESG and Sustainability, signing off from our podcast, Beyond the Bottom Line. Thanks. Have a great day.