Satish Weber

When it comes to disclosing their carbon emissions, publicly listed companies in the US could do better.

Only 45% currently reveal their Scope 1 and Scope 2 emissions, compared to 73% of listed firms in other developed markets.

That will soon end. On 6 March 2024, the Securities and Exchange Commission (SEC) issued regulations that require registrants to provide climate disclosures in their annual reports and registration statements, beginning with annual reports for the year ending 31 December 2025.

It is fair to say that there has been a mixed reaction, politically and in boardrooms.

So will it make a positive difference to carbon emissions?

Satish Weber, Head of Sustainability, Financial Services at Capgemini, is well placed to analyse the mood in the US and the potential impact of the rule.

What was your career path and how did you come to be in your current role?

I've been working in financial services now for over 25 years, almost exclusively from a consulting point of view, although I did have a few years of working in industry and I grew up more on the insurance side of financial services.

I started my career a long time ago in Chicago and ended up in San Francisco doing a lot of startup work in the insurance industry around the 2000s. At this point I've done every type of project imaginable, every function within an insurance organisation. And in the last five years I have moved more broadly into banking and capital markets. I joined Capgemini about seven and a half years ago. It's gone by really fast.
The role that I was originally brought in to do at Capgemini was as a digital market development executive. What does digital mean to financial services? What does digital mean to insurance? Well, it means a lot of different things and you have to kind of create a matrix team from many different parts of the organisation and bring a diverse topic together into something that is cohesive. 

When our new CEO Aiman Ezzat joined, sustainability was a personal passion of his, and one of the first things that he did from a Capgemini point of view was he set our own sustainability targets.
And then he quickly realised the biggest impact that we're going to have from a sustainability perspective is to help our clients on their own sustainability journeys. 

The group started to organise around industry groups related to sustainability and business lines related to sustainability. When it came time to identify a leader for financial services, I think the fact that I had been able to work across multiple parts of the organisation and coordinate these matrix teams and take a very diverse topic and be able to distil that into clear opportunities and challenges for clients was something that led to me being proposed for that role. I will say sustainability's been a passion of mine for a very long time.

I grew up in a unique childhood where we grew our own food, had wood burning stoves in the home, which is very unusual in America, with very sustainability-oriented parents and family. So I'm able to bring that passion to the skills that I have from a business perspective. 

What is it that you love the most about your job?

What I love the most about my job is the variety of people that I get to work with, across Capgemini with our partners and with our clients. And I love the complexity of it. It is not a new topic, but I think it's a very dynamic topic, especially within financial services.

I love being able to engage with clients and have thoughtful conversations where we're exchanging ideas. I like the aspect of being able to engage with clients, exchange ideas, learn new things and help clients solve meaningful problems. 

What kind of impact do you think the finalised SEC regulations will have on the financial services industry and your clients?

The SEC regulations are getting criticised from all sides – for overstepping their boundaries and for not going far enough. But I think what is significant is that the SEC with these regulations has acknowledged that climate risk is a financial risk. I think it is a significant step in and of itself.

The role of the SEC is to protect investors and to create transparency. And that's really what these regulations are intended to do. Now by doing this, I think you're forcing companies to kind of understand their climate-related risks. You're forcing companies to understand and report at least their Scope 1 and 2 emissions. And that is a significant impact – just being able to pull the data together is a big undertaking.

If the SEC had gone so far as to include Scope 3, that would've been a massive transformation for the industry. But even so, scope one and two requires a lot of sources of data. It requires a lot of data mastery. It requires a lot of data transparency and auditability, which many organisations today just don't have.

I think the research has shown that most organisations understand that at some point there will be an impact on their business from climate change. I think most people see that as kind of something far out and they maybe don't totally understand what that impact may be. But by forcing that reporting, I think that it's a first step in what will be increased transparency around the risk and the contribution as it relates to sustainability for organisations.

To what extent do you think the industry will play ball on this?

Well, I think they have to, unless they're willing to accept the fines and the reputational risk. And I think reputational risk is a real risk. It's a very complex environment. There's lots of regulations on the horizon and the regulatory environment is going to remain extremely dynamic.

To the extent that you can start to get a better handle on your data, better mastery of the data, better transparency and auditability in the data, that will help organisations going forward. Because while the SEC may have sidestepped the Scope 3 requirements, certain organisations that do business in Europe are going to have to comply with CSRD. So I think it behoves organisations to start now to prepare for what is sure to be a very dynamic regulatory landscape.

It's a very polarising topic, certainly here in North America, but I think in other regions as well. And I think managing that will be a significant undertaking and something that requires an awful lot of thought going forward.

Do you find that, generally speaking, there is a desire among businesses to be transparent, to be pressing forward improving their ESG credentials?

I think the key to the success in doing that is to not look at ESG as a compliance and as a cost, it is to start to look for ways that ESG and sustainability can drive value creation for the organisation. And I've been encouraged by some of the more recent research that has shown that the number of executives within financial services, but also outside of financial services, that see sustainability and ESG more broadly as a value creation opportunity is growing every year. And I think that is really the way to successfully navigate a sustainability strategy or ESG strategy – it's to look for ways that can add value to your business.

Adding value may be understanding what the climate risk is to your business, getting a better handle on your data, leveraging that data not only for reporting and regulatory compliance, but leveraging that data for better risk management. That then takes the data that you may have a handle on because you have to comply with regulation or you have to do certain reporting, and it turns it into a strategic advantage. And I think that that's the key to a successful sustainability strategy. 

What do you say to businesses that are either a touch reluctant or a little unsure about making the transition?

There's reasons why you need to start thinking about it from a cost and compliance perspective and from a reputational perspective. But the bigger opportunity is to start to think about how that cost can really be an investment in growth and opportunity and value creation for your business. And I really think a lot of this, and this is kind of a personal belief, success in a sustainability strategy comes down to the data to comply. It requires a lot of data and a lot of access to data mastery, data transparency, but that data, as I said, can just turn into a strategic advantage. So it can play multiple roles within your organisation. It can help check the box as it reports to regulation and reporting, but it can also help as it always has. And in financial services specifically, more data is always viewed as better. That's really where we start to pivot the conversation to help executives understand that the cost is not a sunk cost, it's actually an investment that has a return on it.

‘What does Capgemini offer to financial services’ organisations in terms of the strategies and the services?’

One of the things that makes Capgemini unique is the breadth of services that we provide. And all of that is underpinned by a strong culture of entrepreneurship and innovation.

In terms of the specific areas that we focus on from a financial services standpoint, there's four key areas. The first is helping financial services clients be sustainable enterprises. So that's around helping them set a strategy, execute a strategy and then monitor the progress toward that strategy as it relates to becoming a net zero organisation.

Topic area number two is around transparency and predictable auditable reporting and compliance. The third area is about risk and transition management – leveraging data and AI to better understand risk developers mitigation strategies, understanding the transition that your organisation will need to navigate and understanding what that transition risk is and how to navigate and mitigate that transition risk. And then the fourth area is around new product services and better new customer experiences that are related to sustainability or ESG.

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