As a global food and ingredients company involved in cocoa, coffee, dairy, nuts, and spices, Olam Food Ingredients (ofi) is on the front line, helping farmers and communities respond to a changing world. The company has developed innovative ways to effectively communicate its value as a sustainable enterprise to investors and regulators. By taking a pioneering approach to accounting that includes not only financial capital but also natural, social, and human capital, ofi aims to create consistent long-term value that, in turn, builds resilience for the business and its stakeholders.

To learn more about how ofi is tackling some of the thorniest issues facing companies today, we spoke to executive director and group chief financial officer Rishi Kalra about his work. From accounting that properly reflects the costs and benefits of sustainability, to translating sustainability into language any executive, regulator, or investor can understand, Kalra offers valuable insight into the critical role CFOs play today. Following are edited excerpts from our conversation.

Bain: Rishi, you have been working at the intersection of finance and sustainability for many years, both at Olam and as the co-chair of the Asia-Pacific chapter of the CFO Leadership Network for Accounting for Sustainability. How would you describe the role of the CFO in sustainability today, and how has that evolved over time?

Rishi Kalra: Traditionally, sustainability was never part of the CFO’s role; it was always in the CEO’s domain. The challenge was that sustainability wasn’t speaking the language of business leaders. It was becoming very theoretical, and the only language that business leaders understood was dollars and cents, and in a form that they’d always seen: profit and loss statements and balance sheets.

Today, sustainability is at the heart of the role of a CFO from a governance, commercial, and regulatory standpoint. Regulators expect it. Investors are seeking it.

Regulators are now mandating sustainability reporting, and the same rigor that you apply to financial numbers has to be applied to sustainability numbers. If you don’t have the same data governance, and the same processes and systems to track it, the potential for missteps increases; that can be a big risk to any organization.

CFOs can bring the same rigor they apply to accounting and financial numbers to sustainability numbers—asking, for example, whether the data is not only relevant but also good enough to be reported outside the organization.

Bain: Meeting sustainability goals requires a lot of external collaboration. Olam has a history of working across the supply chain to support sustainable food. How did you start doing that?

Kalra: In our industry it was all about “who paid the most got the most.” That was not the business model we wanted to run with. We knew that if we worked with these communities, if we worked with the farmers, if we showed them a better way of improving their livelihoods, we would get a better product and strengthen our networks. There was a commercial rationale: The farmers and communities benefit as much as we do.

This is a journey we have been on for years. Much later, the world started picking up on some of these things, but by then we were entrenched in the communities and networks we had built and were doing this as an integral part of our business, not as a buzzword.

By following this path, we took an important step toward becoming a purpose-led organization.

Bain: What is the value proposition of sustainability for ofi?

Kalra: Unless we can demonstrate a commercial angle to delivering sustainability and see the value from it, it’s only a budget to spend. In that scenario, it would only be about being a good corporate citizen, and there would be no real change. The work we continue at ofi ensures that sustainability remains at the heart of our operations. This effort is led by our Finance for Sustainability team that tracks our actions and impact through our Integrated Impact Statement (IIS), which we started developing way back in 2017. 

Bain: To understand this value, you have to measure the benefits of sustainability. That’s also something you focus on, correct?

Kalra: We’ve been tracking key metrics for a very long period. We launched AtSource some years back to provide customers all the metrics that matter to them. Whatever sustainability data matters to a company—water usage or carbon impact, for example—it already exists with us. This service, which we provide to our customers, creates value both for our customers and for us, in addition to having a real impact on the ground.

I’m a strong advocate for the idea that the future of accounting is in multi-capital accounting, which goes beyond financial capital. Financial capital only looks at the past, at history. It doesn’t account in a way that lets you invest for the future. In financial accounting, there was no common measure of sustainability numbers to help investors or lenders see what was happening.

So, we were one of the first companies in the world to report beyond financial capital through our IIS. We started measuring and reporting the impact of our actions in dollars and cents across natural, social, and human capital—things that are not covered in conventional financial statements. In doing so, we ensure our sustainability and finance teams speak a common numerical language that everyone can understand, evaluate, and articulate.

That has driven real change internally but also helps us explain it effectively externally. Investors are looking to invest in companies that are not only saying what they are doing but actually doing it and can prove it.

The role of finance is to allocate capital to projects that matter. You might have heard our story about bees?

Bain: Please tell it.

Kalra: There are certain food products that can only be pollinated by bees. As one of the largest almond growers in the world, we were seeing productivity on our farms decline because the bees were not in their natural habitat. Every year, we spent millions of dollars for beehive owners to bring bees to our farms to pollinate the almonds. Yet, over the years, productivity continued to decrease. So, we worked with partners to create natural habitats for bees on our farms. What we saw was that productivity steadily increased.

That is where the link starts to be made. There is a cost to doing this, and in a financial statement that money you are spending is an expense, but the value is long-term productivity. So how do you allocate capital to a project like that? It’s by looking at expenses not in the conventional way but by looking at the impact on natural capital and then measuring that in dollars and cents.

It’s a mindset. I see it as a very big mindset shift.

Bain: With this mindset, what is your ambition for sustainability at ofi?

Kalra: Our commitments are 2030 targets in our new sustainability strategy, “Choices for Change.” We applied the concept of double materiality. We want to double down on topics that are both important to the world and that we can make an impact on. It's not everything for everybody. For us, it’s about regenerating the living world, prosperous farmers, thriving communities, and climate action. And we want to hold ourselves to making the biggest impact on these topics.

Bain: What advice would you give to other companies earlier on this journey? How can they shift their mindset?

Kalra: Everybody has to be clear that sustainability is no longer optional. The sooner they can make sustainability a value proposition, the quicker it will be embedded. There’s never a right or wrong time. It’s about your starting point and improving from there. If everyone is improving, the world is benefiting.