Our regular Operator Sessions focus on providing portfolio companies with key takeaways rooted in peer experiences. Our latest session focused on how to start your sustainability journey. With Klarna and Aikito, we looked at practical steps that a company can take to get started and make the case for sooner, rather than later.

While it was evident that there is no one way to get started, considering three key takeaways can help:

1) Start early to help sustainability become a value add rather than a cost centre

2) Understand your impact first, then develop an ESG strategy supported by a solid ESG governance structure

3) Share your journey to enable greater transparency and engagement

Joining us in this session were Lisa Wright, Head of Sustainability at Aikito, and Lisa-Marie von Raepke, ESG Reporting Lead at Klarna. Both our contributors shared their very different journeys in addressing sustainability, both impact and ESG.

Take Away 1: Starting early makes sustainability a value add rather than a cost centre

Starting your sustainability journey can feel overwhelming. The wide range of issues and at times, political correctness, surrounding the topic can make some organisations hesitate to engage. The advantages of implementing sustainability from the very beginning rather than waiting are, however, substantial.

By considering it early, you can integrate sustainable features in your product and service design from the outset, as well as make sustainability a central business lever which will conduct the business as a whole and support the growth of the company. Early integration increases the possibility of making it into a revenue and culture builder. On the flip side, starting later can make the integration with growth and revenues harder (although still possible) and risks sustainability becoming more of a cost centre.

Sustainability as value drivers (Northzone 2022)

As a young, new prop-tech company offering simple loans to landlords and tenants to pay for upfront costs when building commercial spaces, Aikito did just this. The team has grown the company ground up with sustainability as a priority from the start and is on a mission to build with purpose.

The building industry is infamous for its environmentally unfriendly and unsustainable methods. Overall buildings are responsible for 40% of all global emissions. Commercial spaces are renovated every 7-10 years, offering an opportunity to rebuild sustainably more frequently than in buildings replaced or built. Still, Aikito’s experience is that although everyone agrees that promoting sustainable practices in the building industry is important, consumers will often not go out of their way to research more sustainable alternatives and few know how they can actually make a difference.

“Many people don’t know that they can be more sustainable by using the amazing technology and materials that already exist. As most of our clients do not build spaces on a regular basis, adding sustainability to a long to-do list is overwhelming. We make it our responsibility to inform our customers of the options available and how it won’t add any difficulties or increase costs.” highlighted Lisa (Aikito).

For Aikito, a first step was pinpointing where they were sure they could make a difference, and making these part of the commercial offering. With every loan Aikito lends, they now offer a free consultation with a sustainability expert to help their customers save money on energy efficiency and lower their carbon footprint. In some cases, the ROI is the same length as the loan meaning that energy savings can be used to pay off the loan instead. Customers love this value add and it links sustainability directly to Aikito’s growth potential and vision.

“Sustainability was already at the forefront of everyone’s mind from the beginning,” explained Lisa (Aikito), “which meant there was never any friction on the subject internally. Naturally, this made it easy to implement.”