#04 - Connecting the Dots: Neeradha Ravikumar’s Blueprint for Sustainable Growth

And to what you have come to, becoming emerging leader in sustainability space. So we’d love to hear more about you. How you got into it? What inspired you? Yeah. So I’ve always been environmentally focused, but I didn’t really go into it as a career choice or didn’t know that you could even do something like that.

My background is in finance and international business to your point. And I initially worked with AIG and insurance and really my whole life and my whole career felt like I wanted to work in something that had real impact, like a tangible impact, something that I could touch and insurance wasn’t doing it for me finance and this kind of intangible assets weren’t doing it for me.

So I shifted my focus when I moved to New York to real estate and within the real estate industry, I fell into technology and data analytics and fell in love with all of the opportunities and possibilities that exist within that sphere of just having like good data and analytics. From technology for the real estate sector during the pandemic,

I remember reading some articles and hearing news coming out about just the pause in human activity, anthropogenic activity due to the COVID restrictions, the immediate impact that it had in carbon emissions, especially in India. I remember there are articles coming out about how there is a near 50 percent decrease in emissions just in India due to the pause in transportation and residential emissions.

So when I saw that there is an opportunity to work in an industry that could have such a fast and immediate impact that really drove me to do more research and figure out how I could join this community and like, how can I put my skills to use in a way that’s more than just building Power BI dashboards and reports to know, figure out how profitable our company is.

It’s can I take this expertise that I’ve now built in real estate and actually push it towards something that’s more important.  So I think it’s a combination of always wanting to have a tangible impact, but then COVID and, the changes that we’ve been seeing right now in our global economy and in the climate shifted me into that sphere.

Thank you so much for that. I think it’s very true when you have very tangible data, I think that’s what you touched on because it’s something real that we can show impact against, correct? Because whenever we speak to the executive committee or we speak to big corporate leaders I think data is what speaks to them most.

And it’s phenomenal that, you connected the dots between what you did, your skills, your international business, from maybe it could be policies, what you’re seeing in the space to what you’re looking at data and then bringing it together for a right cause, which is globally impactful.

So, love that aspect of what drove you and what inspired you to come into this. So thanks for, taking that journey with us from data and collecting. I’m sure it’s inspiring for many young leaders to say, hey, we don’t all have to start with sustainability, but, look at our skill sets that we have and connect the dots for something that’s more tangible.

That’s more giving back to a much more global space. I think that’s awesome to that how you iterated your journey. Given that you’re so into the data analytics aspect of it, maybe you can speak a little more about how you’ve been able to use it to maybe influence the work that you’ve done in sustainability space, particularly maybe in the real estate that now that you’re involved in.

But also I think to influence key leaders, business leaders, and build business strategy. Maybe you can speak a little bit about that. Yeah, definitely.  So I think when it comes to sustainability in general and data, you can’t change what you can’t measure. You can’t have an impact if you don’t know what you’re impacting.

So the underlying foundation there is like good data, right? So in real estate, when you think about sustainability, it’s really energy the big piece, right? It’s decarbonization, it’s energy use and energy efficiency. And when we’re talking to asset managers and operations, they might not care about sustainability in the same way that we’re passionate about it, so for them, you have to tie it back to ROI. You have to tie it back to the investment and it’s not easy to get that ROI calculation for something that’s related to sustainability. It’s like people consider it a softer science, right? It’s not finance. It’s not directly correlating to the bottom line.

But our job is to make it tie back to the bottom line. So for our energy contracts, what we did is, we had to collect the current annual energy consumption, energy usage and energy cost across our entire portfolio. That’s over 160 buildings. And so to get like meter level data for each of those buildings and then truly understand how much it’s costing us right now in each market to pay for this electricity, which for a portfolio our size is close to this can be hundreds of millions of dollars, right?

And then instead of taking it to asset managers and or the investment team and saying we want to do these projects because they’re good for sustainability. We say we’re going to do these projects because yes, they’re good for sustainability and tie into our organizational goals, but they also will save us money.

This is also going to be a way to mitigate the impacts of fluctuating energy prices over the course of 10, 15 years, we have a renewable contract in place that spans 15 years. We are from a sustainability perspective, completely zeroing out our emissions across our entire portfolio. And then from a business perspective, we now have steady state of expense across our entire portfolio.

We know how much it’s going to cost. Any global changes that occur in the energy industry aren’t really going to impact our prices because we’ve locked in on a renewable rate. So I think it is taking that approach of you have your own sustainability measure that you want to implement, but you have to figure out a way to tell that story with good data in a way that makes it important for other teams. 

I think that’s awesome because what I heard from you is a a core word of ESG risk, correct? Because people don’t tie it back to the risk at all from an ESG space. And I think you very well highlighted, here, what is the risk that you’re talking, you spoke about energy costs

that’s fluctuating. You spoke about energy costs that could be on rise. But because you’re containing and you’re forecasting and predicting that risk, you are bringing that ROI and that’s huge. And it it helps people see things in a different way. It’s the same thing that we are talking about, just packaging it into the audiences that we are talking to.

And it’s a good approach to look at it from an ESG space because especially because as you said, it’s a soft, tangible thing that we see, but converting it into something that’s more, financial based by the gain based by looking at the audiences that it targets, the industries that it does.

I think it adds a lot more value by using good data. I think that’s phenomenal how you explain that. Thanks for doing that. But taking that a little further when we speak about operations, correct? When  into bringing sustainability into operations, we’re also looking at it from an aspect of it doesn’t just touch one stakeholder in your life cycle.

Because especially if you’re in real estate, we’re going to see it from a supplier perspective. You’re going to be seeing it from stakeholders. It’s going to touch employees in certain ways. It’s not just sustainability from a green grass emission perspective, but it’s much more holistic.

It could be from an investment aspect of it, whether it’s looking into green funds or whether it’s looking into the social aspect of it because it could be your employees who are driving certain initiatives and looking at that data because now it’s helping them think about it from a data generation aspect.

It could also mean reporting, because I think that’s huge, because regulations are corely focused on reporting, and we are still, not there from a perspective of a whole life cycle where the regulations drive any aspect of ESG life cycle, so there are components of it. So I think from an operation perspective, because you are talking to such a large portfolio of people, you must be seeing certain challenges, but at the same time you’re seeing opportunities.

So maybe you can talk a little bit about those as well.  Yeah, definitely. I think it’s really important to your point to call out that there are so many different stakeholders involved in any kind of sustainability measure, especially in real estate. From my perspective, like we have an office portfolio, so when we’re talking about sustainability for the built environment within like a commercial office portfolio, yes, we have the emissions and the actual impact from just running our building, but a lot of

the impact comes from being able to work with our tenants to figure out like how they’re managing their space and how they’re like, interacting with the community and with the operations team within those buildings. We can’t necessarily control how much electricity a tenant uses within their leased area but we can educate them and give them reports and provide that story.

The data tells a story, right? Provide that story to them of how their operational efficiency is impacting the larger environment. And a fun example, actually, is like stepping away from energy for a moment and going towards waste management and circular economy. A large portion of our portfolio has tenants who are fashion retailers.

And so we’re working on a project right now that involves our tenants, operations, suppliers and vendors to figure out how to recycle poly bags. So all of our clothes and fashion retailers get their inventory in little those little thin plastic bags, those aren’t municipally recyclable and there’s not right now a stream within New York City or

within the country I think that will take that separately. So we’re working on a project right now to figure out how to aggregate all of our tenants’ poly bags together and bail them and then either sell them back to a vendor who will then take that plastic and repurpose it into a new product.

Outdoor materials like decks and chairs, or if we can just get them to a proper Murph facility where they can be recycled and packaged and sold back to a different or repurposed in some other way, but without the data from each tenant or without knowing within each building, first of all, which tenants are there and then for those tenants, how many of them are fashion retailers and have the poly bags and getting all of that information together and then to be able to execute a strategy that works with all of these different stakeholders and different people who have different priorities, right?

Our focus is on recycling, but maybe the tenant is looking to improve their sustainability measures, but maybe also a way to standardize operations or become more efficient in how they’re getting rid of their waste. So to get all of these goals together and actually put out a plan is a lot of fun, very exciting, but also quite challenging.

I think it’s very innovative as well. It’s very fulfilling if you look at it from a larger picture, correct? Because I think as you were talking, I was there going back to an article where I know these plastic bags are being recycled and repurposed into tiny pillets that can be used for building material.

 So it’s just phenomenal how much it pushes us to think outside the box, be creative. As much as we know, plastic is all over and around us. But as you said, it’s fun. And I think this gives us a perspective of, hey, what can we do as a community?

And it leads perfectly well into my next question about cross functional areas of how we think about ESG, the circular economy, but also repurpose the five hours, because now we’ve expanded from the three hours to the five hours. So it’s just going to be fun doing all of it and everything connects, correct?

We’re going back to the first question where we spoke about just ESG as a vertical to now we are talking about everybody, correct? We are looking at, you spoke about the fashion industry. So we are looking people from fashion domain. Maybe even from chemical industry, to say, hey, how can we repurpose this plastic?

We are looking at real estate, where you’re pushing that initiative. There’s investments that are coming and I’m sure along the way you’re picking up smaller vendors as well, and all of y’all are coming together as thought leaders to create something more innovative and more purposeful.

So I think that journey is so beautiful. So how do you actually look at those challenges? Because you spoke about the challenges, this is the fun part of it that we all spoke about, but the challenges and how do you first start maybe within your own organization and then, education awareness because it’s not an easy sell because we really don’t have a regulatory stick globally that drives us.

We have it’s in pockets. I know Europe is doing a little better. They’ve been always leaders in the space with their regulations and pushing that and I think there’s a voice of the people as well. The common man is also very well aware and they’re pushing that. And the last thing I would ask you is the Gen Zs, correct?

I think the younger generation is now taking a stance. So all of these people cross functionally come together whether it’s operations, technology, as a business. So I would love to hear what you’re seeing and what your challenges are as well. I think to your point, one of the most important factors here is the human component, right?

People are getting more and more invested in sustainability. They’re seeing the impacts of climate change. Gen Z and Millennials are stepping up. There’s protests all over the place, and if corporations want to a keep getting investors to invest in them and also be able to hire and retain employees who want to work for that company, they’re going to have to take a strong look at their sustainable practices and how they’re approaching it.

Because it’s not just about emissions anymore. It is more holistic. It’s, are you showing that you care about  how you’re doing business? Not to keep repeating the name of the podcast, but people are expecting beyond the bottom line, right? They’re expecting more from their corporations.

They expect some responsibility and I think getting that message out in front of your employees, your tenants, your investors is one of the most critical pieces. From the real estate perspective, we noticed that a lot of tenants have their own lofty sustainability goals. They have their own required reporting that they have to do.

And so in order to support them and their goals, we have to actually be able to mitigate our impact as well. Otherwise we’re not going to be able to get the tenants. We’re not going to be able to do the leasing \ that actually draws down our business as well. So it’s in the best interest of everyone to look at this in a broader perspective and understand that it’s not just for corporate reporting.

It’s for everything. If your business is going to be successful, you have to now start thinking about your impact on the environment, on communities, on everything as a whole. Wonderful. So from a KPI perspective for you, as because we spoke about data, and I think I would love to touch on that, is what are some of the core KPIs that you’re seeing to drive the messaging that you just spoke about?

Because as you say, data has a story to tell. So maybe there are certain KPIs that you’ve seen in your experience, bringing something ground up whether it’s, there’s an audience for corporate, there’s an audience for investors, and even the younger generation that we spoke about, Gen Z, correct?

Because they’re asking those questions as they interview with corporates now. So given all of that are there some key KPIs that you would focus, would you want to tell the audience, hey, these are things that people are looking at, focus on this, because where do you create the data as such? I think it really depends on what perspective you’re taking on any metric that you’re looking at, right? In general, that’s the fun part about data is like you get a different story, a different vision, every way you like splice the information.  But one thing that is standard across everything, I think, is the focus on intensity metrics.

So for energy, it’s energy use intensity, whether that’s by square footage, by person, by building that particular metric gives you a normalized view of your entire portfolio and also gives you the flexibility of being able to account for variances or changes. For example, if we have 10 buildings in a portfolio, it doesn’t really make sense to just count the metric tons of carbon that we’re emitting by volume every year.

 Because a big building that’s more energy efficient is better than a small building that’s not as efficient. So, we look at intensity by square footage, same for water use. And another interesting metric that comes up a lot is on the investment side is capital per ton of CO2e.

So from the fund level, we have investors saying for every million dollars that we’re investing, what is the equivalent metric tons of CO2 that your fund will be emitting and do we see that number going down over time is another interesting metric that I saw. In general, though, I do think it’s the focus on intensity metrics that kind of normalize things across the portfolio.

Have you also started seeing because a lot of things are looking from a carbon offset perspective, correct? Because we are talking about emission. We’re trying to talk about the baseline of things that we do in the environmental space, but are you also looking to come and look at people saying, hey, what is the carbon credits?

How can I offset it? Is that a core area that you think from a metrics perspective that people are looking? Because I think that would be something of interest to investors and maybe also for seeing ROI, correct? Not only just saying, hey, this is what we are emitting and this is the intensity, but remediation aspect of it.

Do you see that people come in, ask you for that? Or when you speak with the stakeholders, is that something coming up? Yes, I think less than specifically carbon offsets. What we get a lot is, do you have a decarbonization plan. For the built environment, our overall emissions, the electricity that we produce, we have a two pronged approach.

We can either eliminate all of the emissions entirely by procuring renewable electricity for the entire portfolio, in which case the offset metric is simply equivalent to the electricity use. That’s the approach that we’ve taken to the end for the entire portfolio. So that kind of stuff really goes into a vision or a plan.

It’s like, how are you purchasing the renewable electricity that’s required to offset or eliminate all of your emissions? That is something that investors are frequently asking about is what’s your plan? What’s your path to net zero? How do you envision either procuring renewable electricity for all of your assets or doing property level decarbonization plans, and that kind of ties back to the energy intensity, for example, if there’s a building that needs a cooler or tiller replaced, but the end of life cycle for that component is already coming in five years.

We wouldn’t go replace it right now. We would wait until the end of the cycle and then just replace it then. But we’d keep track of that energy intensity metric to make sure that efficiency wise we don’t go over the certain threshold for square footage. But what about carbon credits? Because I know you have a lot of asset managers that you work with.

So I think green investments is something that’s picking up globally. Maybe America is a little behind the curve, but globally it is something that, fund managers are looking into but carbon credits in the sense, because where I’m going with this is tying it back to some of the CSR  activities, whether it’s like biodiversity, because certain things cannot be controlled, but at least we can look at  the damage that we’re doing and maybe compensating for that.

And I think there are efforts that are being given. So to incentivize what we are doing from, to expedite our ESG process and, becoming more aware, these green credits come into play. So, being in a real estate, do you see that taking shape or is it still very immature at this time?

 I think carbon credits.

 I just think, need to be verified a bit more because we’ve seen a lot of cases where you can buy offsets or you can buy credits and then they’re not directly tied to a tangible impact and so for our corporate strategy offsets and credits are the last prong.

We’re focusing on large scale procuring renewable electricity. And so we would get the renewable energy certificates or the wrecks or effects for nuclear energy from those procurement contracts and then would retire them. And then we would focus on actual property level decarbonization plans before we move to credits.

I think because there’s a lot of greenwashing that’s happening in that space. I think that’s one of the reasons. Yeah. So that was an intentional question just to see, how we play in that space, cause there was some good work that’s happening, especially I think from biodiversity that I’ve heard in the industry, that there is an effort, especially if there’s water.

Water is one of the sources that they’re contamination is happening. People are thinking way ahead in that place because the, the diversity, the biodiversity is the first thing, whether it’s the plants, the animals in that space is what gets impacted. So it’s good to know that, from as a corporate and as leaders that you’re thinking that as a last resource, especially given, the space of greenwashing and a lot more tying of the ends is needed there. 

So from your perspective, what are you seeing in the industry as a trend in the ESG and sustainability space? Maybe you can touch a little upon that. Yeah, you gave a great segue in greenwashing. There was a recent rule that came out in Canada, actually, that specifically focuses on greenwashing and sets out a list of rules that corporations have to follow for any of their advertising or marketing.

So I think that’s something that we see coming out in the news a lot now is people really diving in to the claims that these corporations are making to make sure that there is an actual, tangible impact that’s being brought by the actions that they’re taking, and it’s not just a greenwashing claim.

That’s a pretty big focus and then to your point, biodiversity and water is something that’s a hot topic right now. And if there is more work that happens in the biodiversity and water credits, like I would be so interested to figure that out and figure out how to pull that into our strategy.

But there’s definitely needs to be more work and more standards and frameworks set aside or developed for that portion before I think it builds into any kind of really good corporate strategy. Awesome. So from an innovation perspective, what are you seeing in the space, especially because I was talking to somebody on another podcast and, they were talking about what the steel and the aluminium industry is doing, correct?

So being in real estate I’m sure you guys are also thinking about it, especially given that you’re so invested in ESG and sustainability from a corporate perspective, your leadership is involved in it. You have goals and things like that. I’m sure you’re looking at some very tangible, future state innovations.

Is there something that, or in general, if you can talk about what the industry trends are? Yeah, definitely. So one thing that I think is very exciting and ties in nicely with our data conversation as well is Digital Twin Technology specific for the real estate or the built environment in general.

 This would be such a cool And really transformative technology if we can get it up and running correctly, but a Digital Twin is essentially a mirror copy of every piece of technology and every mechanical component that exists within a building and would allow you to, from a system or a centralized location, accurately and cleanly track how much energy or electricity is being consumed on every floor, every area from a microwave, from a radiator, and so we’d have all of that information in one platform that you could go easily manage could turn lights on and off from a centralized location.

You could track if there are tenants in a space, and if they’re not, you can make sure that the building shuts down based on the number of people who are in so with that kind of oversight and with that level of granularity, there’s so much that you can accomplish from an energy efficiency, water efficiency, even waste efficiency perspective.

Imagine a world where there’s a building that’s entirely renewably powered. It connects to the grid seamlessly, generates power from solar panels. We use what we need because we have an exact shape mapped out already. And then any extra directly goes back into the grid to be consumed by other buildings or tenants or anyone else who needs it. That kind of seamless infrastructure is of course, like 50 years away.

Yeah, it would be a different world, but the starting points are here right like Digital Twin Technology exists. It’s just how do we get all the sensors connected? How do you get all of this data in and standardized and normalized in a way that it makes sense and you can actually start to get those insights. So that’s something that’s very exciting.

And I think it’s going to be like a trend that you start seeing in a lot of the built environment and real estate industries is moving towards this. Everything’s already electronic anyway. Everything’s wifi, everything’s Bluetooth connected. Like how do we pull all of this information together so that we can more effectively manage it from one place? 

Yeah, I think Smart Cities IoT has already set its foot there. We’ve been working on it, but I think how do we connect the dots in the, the ecosystem of ESG and sustainability. I think it’s a brilliant use case and we’ll have to see what all comes through that way. So I think you explained it a beautiful a dream world of, what we can do with the best of what we have and how do we preserve the planet and be green.

I think that’s a great way to end this podcast. So I would just before we say, is there any last words that you would want to share with our audience as we close this podcast? Just that sustainability is like such a new industry, and it’s so important. So for anyone who is out there and interested in joining the sustainability community, you don’t have to have an environmental science background.

You don’t have to like already be in there. It’s just be passionate about what you’re doing and find the right skill set that works for you. And there’s so many opportunities available. We need so much help to fix this problem from a multitude of different stakeholders. Thank you so much, Neeradha

it was wonderful, talking to you. It’s a pleasure that, you could bring so much of insight. It’s inspirational to see young leaders of your kind to take this first step forward, connect the dots, take the jump. As you said, moving from one domain to another vertical and driving this with passion.

So thanks for that. We loved having you on this call as well as on this podcast. So thanks for your time and appreciate it. Thank you so much for having me.