Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: You're listening to Bloomberg Business Week with Carol Messer and
Speaker 2: Tim Stenebek on Bloomberg Radio.
Speaker 3: We talk a lot about metaverse high tech stuff. Sometimes
Speaker 3: we talk low tech, and we talk mac and cheese.
Speaker 2: And why not. They're all good. They are all good,
Speaker 2: and they can sometimes take you unexpected places. Can you
Speaker 2: build a dream on mac and cheese? I was trying
Speaker 2: to think of what the European equivalent is to mac
Speaker 2: and cheese. Such a big mac and cheese we do,
Speaker 2: but it's not quite the same. It can be good.
Speaker 2: I have asked people to bring me back boxes of
Speaker 2: it from the US before. Yeah. Look, this is what
Speaker 2: our next guest has done. She's made mac and cheese
Speaker 2: part of her brand, part of her business idea, and
Speaker 2: something that she's built a new career on and we're
Speaker 2: thrilled to talk more about it as well. The book
Speaker 2: that she's written is Mac and Cheese Millionaire, Building a
Speaker 2: Better Business by Thinking outside the box, and that's out there.
Speaker 2: Aaron Waite joins us now from Oakland, California. Aaron, welcome,
Speaker 2: great to talk to you. And you went from restaurants
Speaker 2: to law I'm back to restaurants. Talk us through that
Speaker 2: process and how you ended up becoming you know, the
Speaker 2: Queen of mac and cheese.
Speaker 1: Sure, So you know, I began my career with a
Speaker 1: huge passion for food and had you know, cooked in restaurants,
Speaker 1: but found that it was a really dead end job.
Speaker 1: You know, the pay is low, the treatment is not great.
Speaker 1: So I just did not see a future for myself.
Speaker 1: So I decided to go to law school and do
Speaker 1: what you know, generations of lost people with no direction
Speaker 1: you have done and become a lawyer. But I didn't.
Speaker 1: I didn't love it, so I actually got fired. Turns
Speaker 1: out you're you're not good at what you don't like doing.
Speaker 1: And I decided I wanted to create the restaurant that
Speaker 1: I wish that I could have worked at. So not
Speaker 1: was it a love of family, my family recipe of
Speaker 1: mac and cheese and wanting to bring that to the market,
Speaker 1: because I just didn't see that being filled anywhere. You know,
Speaker 1: there's like pizza restaurants, barbecue, but not mac and cheese.
Speaker 1: But I really want to focus on how do I
Speaker 1: create the kind of workplace that I wish, the kind
Speaker 1: of restaurant that I could have worked in and what
Speaker 1: do I need to do to do that?
Speaker 3: So what in particular did you want in terms of
Speaker 3: making it the place that you wanted to work at.
Speaker 3: What was it that needed to be different?
Speaker 1: You know? You know, my book is filled with a
Speaker 1: lot of trial and error. I think the truth is
Speaker 1: I didn't know. I knew what I didn't want to
Speaker 1: do right, but sometimes it's harder when you haven't had
Speaker 1: the example set of what you do want to do.
Speaker 1: So I found that it really came down to three things,
Speaker 1: which was you know, communication, collaboration, and collective success and
Speaker 1: having to give you examples of you know, ways that
Speaker 1: we did all those three things. But that I found
Speaker 1: was really the secret to our success. And you know,
Speaker 1: not only in an industry where the average tenure is
Speaker 1: you know, less than ninety days. Our average tenure is
Speaker 1: two and a half years, but our profitability was in
Speaker 1: the top one percent of restaurants. So I'm really proud
Speaker 1: of what we achieved.
Speaker 2: Yeah, because looks it's a difficult business to get into,
Speaker 2: and I think if you know, if you're going to
Speaker 2: make a leap of faith into something new, you didn't
Speaker 2: perhaps pick the clearest or the easiest path to do that.
Speaker 2: Talk us about getting getting the first the first home
Speaker 2: room started.
Speaker 3: You know, statistics about restaurants that most fail in their
Speaker 3: first year. I mean it's daunting, but anyway, go ahead,
Speaker 3: because it's tough.
Speaker 1: No, they do, and I mean I think that's why.
Speaker 1: Actually it makes for such a great business book, because
Speaker 1: you know, if we were using these techniques successfully, I mean,
Speaker 1: it is the hardest industry to make it, so, you know,
Speaker 1: I really think they can these ideas can work anywhere.
Speaker 1: But yeah, I mean it's it's crazy. I mean, banks
Speaker 1: won't even give you loans because it's considered you know,
Speaker 1: your your odds are better and less Vegas than investing
Speaker 1: in a restaurant. But I do think that with sort
Speaker 1: of you know, by using these techniques, I think people
Speaker 1: in all kinds of businesses can can beat the odds.
Speaker 2: Took us through the first few months of that business, though,
Speaker 2: at what point did you know that you hot you
Speaker 2: around to something and that you that was going to
Speaker 2: take off into something that of course it became a
Speaker 2: cultish hit.
Speaker 1: Yeah, you know, luckily we're packed from you know, day one,
Speaker 1: and I really credit it to frankly, just having an
Speaker 1: exceptionally good quality product. So you know, at most restaurants,
Speaker 1: if they have mac and cheese at all, it is
Speaker 1: a side dish. It's something that is not paid very
Speaker 1: much attention to. And for us, this is really the
Speaker 1: main thing. So you know, we made each one to order,
Speaker 1: We used my family recipe. We put nearly a quarter
Speaker 1: pound of cheese in each portion, so you know, it's
Speaker 1: incredibly cheesy, it's fresh, it's it's made with love and care,
Speaker 1: and you know, and that makes a huge difference versus
Speaker 1: sitting in a vat somewhere. So I think people were
Speaker 1: very very us with the products from day one. But frankly,
Speaker 1: I think also what we did is like created tremendous
Speaker 1: value surrounding the experience. Because I had worked a lot
Speaker 1: in fine dining, but something that I thought was really
Speaker 1: lacking in a more casual setting is like, you know,
Speaker 1: great design and great service. Those things don't need to
Speaker 1: cost more, they just need someone to care more. And so,
Speaker 1: you know, I think that people's perception of value of
Speaker 1: getting to sit in this really beautifully designed space, getting
Speaker 1: you know, some of the best service that they've had
Speaker 1: in a restaurant while eating, you know, the best version
Speaker 1: of mac and cheese they've ever had. It's just a
Speaker 1: winning combo.
Speaker 3: I have to say, there's a restaurant in our neighborhood,
Speaker 3: a local, one family run, and they have an incredible
Speaker 3: mac and cheese and we will go there just for
Speaker 3: the mac and cheese. And it used to be a
Speaker 3: place downtown. I don't even know if it exists, but
Speaker 3: that's all it did. And great, you know, cast iron
Speaker 3: skillets and any kind of like varieties of mac and cheese.
Speaker 3: It is like just that food that we just love.
Speaker 1: We just love.
Speaker 3: What's one of the biggest I don't know what was
Speaker 3: one of the biggest moments in this process. I feel
Speaker 3: like everybody who started a business, especially in the restaurant industry,
Speaker 3: we've all seen.
Speaker 1: The bear and loved it.
Speaker 3: But I do wonder where you were. I don't know.
Speaker 3: It was either just a huge learning experience, whether from
Speaker 3: your team, from your workers, I don't know, tell.
Speaker 1: Us, you know. I have to say we used a
Speaker 1: lot of like really interesting techniques to engage people in
Speaker 1: the business. For instance, we're an open book company and
Speaker 1: so share financials and teach financial literacy. And I think
Speaker 1: that was a huge aha, right, It like really unlocks
Speaker 1: people's like potential and power to understand business in a
Speaker 1: deep way and to feel like they're part of something
Speaker 1: that's bigger than themselves versus just showing up every day
Speaker 1: to cook. So, you know, I'd say that's one moment
Speaker 1: that I'm incredibly proud of. But you know, another is
Speaker 1: that we used all these techniques of you know, we
Speaker 1: had a lot of different tools to be communicating, collaborating,
Speaker 1: and we actually came up with a solution to sexual
Speaker 1: harassment which our staff was experiencing. And it I wrote
Speaker 1: a viral piece in Washington Post about it, it got
Speaker 1: adopted by the EEO CEO went to Washington to go
Speaker 1: testify about it, and it's now used by restaurants and
Speaker 1: bars all around the world. So, you know, I think
Speaker 1: that also, frankly, when you tap into the power of
Speaker 1: a workforce. You know, we were just a small restaurant
Speaker 1: but made a difference on a global scale, and I think,
Speaker 1: you know, I'm incredibly proud of that.
Speaker 3: But talk to us a little bit more about that,
Speaker 3: like how you came to realize it's something needed to
Speaker 3: be done. Differently, I think it's safe to say that
Speaker 3: most women have had some degree of sexual harassment, some
Speaker 3: that is quote unquote harmless. I don't even know that
Speaker 3: I should use that word that I'm probably gonna be
Speaker 3: spacked ss No, I know, but I guess we're we
Speaker 3: grow up and just are like, Okay, I got to
Speaker 3: get through because I love my job. I want to
Speaker 3: keep going that kind of thing. And then there's ones that, Nope,
Speaker 3: you're going to court because somebody has to pay for something.
Speaker 3: But tell us about how you approached it and you
Speaker 3: knew you had to kind of maybe change it or
Speaker 3: have some kind of impact and why.
Speaker 1: Yeah, you know, honestly, well, I was approached by a
Speaker 1: number of female servers at the restaurant who all were complaining,
Speaker 1: and honestly, they said they'd worked at a ton of
Speaker 1: places and this had happened everywhere. This was just the
Speaker 1: first time that they thought maybe someone would actually do
Speaker 1: something about it. And so I did what I usually
Speaker 1: did when someone brings up a problem, which is include
Speaker 1: them in the solution to it. So, you know, we
Speaker 1: came up with a system that our entire staff that
Speaker 1: want to participate did participate in creating it. And I
Speaker 1: think the reason it's so effective is that honestly, it
Speaker 1: really sort of honors people wherever they are. It's like
Speaker 1: basically a color coded system, and when someone experiences something
Speaker 1: with that color, they just report the color and an
Speaker 1: action is taken. So you know, for instance, a yellow
Speaker 1: is just you get a bad vibe at a table.
Speaker 1: You just say hey, I've got a yellow at table two,
Speaker 1: and a manager will take it over for you. And
Speaker 1: an orange is you have a bad feeling. Plus let's
Speaker 1: say an ambiguous comment something like I like your shirt.
Speaker 1: You know, depending on who says that to you and
Speaker 1: how they say it to you, it might feel totally
Speaker 1: benign or aggressive. And so same deal. Someone just goes
Speaker 1: to a manager and says, hey, I've got an orange
Speaker 1: at table too, and the manager takes it over. And
Speaker 1: with a red, that's someone saying something overtly sexual or
Speaker 1: touching a staff member, and in that case, again the
Speaker 1: staff member just says the color and then the manager's
Speaker 1: required to kick the person out. And you know, I
Speaker 1: think what's so cool about the system is that you know,
Speaker 1: guests honestly don't know is being used on them, So
Speaker 1: it's very customer friendly. It. You know, staff members are
Speaker 1: going to have all kinds of different experiences, and some
Speaker 1: people are going to find certain things threatening and other
Speaker 1: ones won't, and so it allows us to meet staff
Speaker 1: where they are and take action. And it's really easy
Speaker 1: for managers to use. And what we found is amazing.
Speaker 1: As we thought it would just be a way of
Speaker 1: coping with harassment and just giving us a way to
Speaker 1: deal with it, but actually what it did is it
Speaker 1: really nearly eliminated the worst forms of it, because very
Speaker 1: few people walk into a restaurant and like stick their
Speaker 1: hand of someone's shirt, but you know, they will usually
Speaker 1: start with lower level things like checking them out or
Speaker 1: making little level comments, and then once things are tolerated,
Speaker 1: they escalate their behavior. So it just really sort of
Speaker 1: stopped the problem from happening, and in a way that
Speaker 1: I think is really respectful to people, you know, no
Speaker 1: matter if their customer, staff manager.
Speaker 3: And I got to go on record because I'm going
Speaker 3: to get my sisters, my daughter and rightfully, so none
Speaker 3: of it is harmless. I guess just when you grow
Speaker 3: up in a world where I think women still feel
Speaker 3: like sometimes you've just got to kind of bite your
Speaker 3: tongue to kind of get through, and I just want
Speaker 3: to put it out that any form of sexual harassment,
Speaker 3: whether it's yellow, whatever color, it's all bad, it's all harmful.
Speaker 2: I think what I find really interesting about this Color
Speaker 2: Code of Conduct is you're giving people language to be
Speaker 2: able to talk about how they feel and how they
Speaker 2: feel affected by it. And it's a model. It's been
Speaker 2: taken up by businesses elsewhere as well. Talk to us
Speaker 2: a little bit about how you're seeing. You know, what
Speaker 2: you've heard about how the Color Code of conducts being
Speaker 2: used outside of your business.
Speaker 1: Yeah, I mean I've gotten like from just fabulous feedback.
Speaker 1: And actually, you know, one of the most fun parts
Speaker 1: is there's plenty of people that use it that I'll
Speaker 1: never know. But I'll walk into a bar and I'll
Speaker 1: find like one of our posters on the wall. Or
Speaker 1: I went to speak at a conference and it was
Speaker 1: like all these you know, bar owners from like across
Speaker 1: America and the globe. And I was so surprised because
Speaker 1: at the end of my session, I didn't, you know,
Speaker 1: I wasn't getting a ton of questions, and I was like,
Speaker 1: what's happening here? And then I asked people to raise
Speaker 1: their hand if they had known of the system or
Speaker 1: if they use it in their bar and like everyone
Speaker 1: raised their hand and it's like okay, cool. So I
Speaker 1: wonder doesn't help people.
Speaker 2: This is an industry where there's a huge staff turnover, right,
Speaker 2: I wonder how much that's helped towards staff retention at
Speaker 2: a time. You know, we talk so much about the
Speaker 2: tight labor markets, and we know that hospitality is one
Speaker 2: sector really affected by that. Has it helped you to
Speaker 2: keep people good people on your style?
Speaker 1: Oh my god, one hundred percent. I mean to my
Speaker 1: point about sort of all the tools in the book, right,
Speaker 1: if we can use them, then anyone can, because I
Speaker 1: think you know, something really missing from the conversation right
Speaker 1: now about the labor market and what to do is that,
Speaker 1: in my experience, the most meaningful things actually don't cost money.
Speaker 1: They just take time and care. Right, Like, we are constrained.
Speaker 1: There's only so much we can pay people when we're
Speaker 1: charging folks ten dollars for mac and cheese, right, Like,
Speaker 1: it's just that's just true. It's not going to be
Speaker 1: the most highly paid job of someone's life, probably, but
Speaker 1: you know, there's so much you can do that makes
Speaker 1: work an enjoyable place to come to and meaningful and
Speaker 1: purposeful and I think those are the things, honestly that
Speaker 1: you know, make life worth living.
Speaker 2: Are there any of your original teams still with you
Speaker 2: in homeroom?
Speaker 1: Oh?
Speaker 2: Yeah, a bunch, so they stayed on. I mean, it
Speaker 2: proves that it works, right. One of the things that
Speaker 2: I really liked about your book and your own story
Speaker 2: as well as You're talking about wanting to fall in
Speaker 2: love with work, and do you think that we need
Speaker 2: to be in love with what we do in order
Speaker 2: to succeed.
Speaker 1: I mean, in my experience, yes, I mean, you know,
Speaker 1: I'm really smart, and I was working as a lawyer
Speaker 1: and I got fired. And I don't think it's an accident.
Speaker 1: I found it very hard to be good at something
Speaker 1: that I didn't like doing, you know, versus something I'm
Speaker 1: passionate about. You know, my my worst days as an
Speaker 1: entrepreneur have been better than my best days as a lawyer.
Speaker 1: But you know, I think, I think it's a real gift,
Speaker 1: you know, to wake up and enjoy going to work.
Speaker 1: And it's one I didn't, you know, previous to starting
Speaker 1: my own restaurant think was possible. So I guess I
Speaker 1: just wanted to communicate people to people that I do
Speaker 1: think it's possible, and I try to give them tips
Speaker 1: and tools for you know, how to find that passion
Speaker 1: within yourself, how to pursue it, how to create spaces
Speaker 1: where other people can't to because I think honestly, we
Speaker 1: spend more of our lives at work than in almost
Speaker 1: anything else, and we don't enjoy it. Like what are
Speaker 1: we doing here?
Speaker 3: I would certainly say yes. It's one of the pieces
Speaker 3: of advice my dad gave to me growing up, like, fine,
Speaker 3: something you love to do. And I remember my first
Speaker 3: job in journalism. I had to be in it like
Speaker 3: the wee hours made maybe fourteen fifteen thousand dollars, had
Speaker 3: to borrow money from my father and mother to buy
Speaker 3: a car, use car for four thousand dollars, or I
Speaker 3: can get into New York City because there was no
Speaker 3: mass transportation. But it was I knew it's what I
Speaker 3: wanted to do, and it's amazing, Like right, when you
Speaker 3: find something you want to do. Having said that, you
Speaker 3: also write. To create anything new of value, you always
Speaker 3: have to be willing to fail upward, to make mistakes
Speaker 3: and get a little better every time. This philosophy had
Speaker 3: worked for you for me, you with everything from adding
Speaker 3: new menu items to refining management philosophies, but something about
Speaker 3: experimenting with people's safety at work felt too important to
Speaker 3: fail upward.
Speaker 1: That's important, Yeah, I mean most of the book is
Speaker 1: sort of ridiculous stories about you know, what are the
Speaker 1: ways that we failed before we found systems that worked,
Speaker 1: And I was pretty terrified of doing that with our
Speaker 1: harassment system. But the truth is, there is no other
Speaker 1: way to create something that doesn't yet exist. So we did.
Speaker 1: And I tried to put in our mistakes so that
Speaker 1: other people don't need to make them too.
Speaker 2: I really, I really enjoyed how honest you were about this, because,
Speaker 2: you know, having when you have a non linear career path,
Speaker 2: you've moving out of things, it can be difficult to
Speaker 2: be honest about the stuff that doesn't work. You know,
Speaker 2: when you've invested, for example, a lot of money and
Speaker 2: going to law school, you know that's got to hurt, right,
Speaker 2: And I wonder do you take things from your legal
Speaker 2: career into what you're doing now? Are there elements of
Speaker 2: what you learned in law school and maybe what you
Speaker 2: learned from from working in the industry as well, that
Speaker 2: are relevant to your job now?
Speaker 1: You know, actually, one of the most helpful things that
Speaker 1: I took from my legal career into being an entrepreneur
Speaker 1: was actually how we deal with discipline. I had been
Speaker 1: really interested in this question because I feel like it's
Speaker 1: pretty ineffective in most workplaces. And I had worked all
Speaker 1: through law school at a district attorney's office, actually Kama
Speaker 1: Hair's office when she was d of San Francisco. But
Speaker 1: so I was very interested in, like, what are different,
Speaker 1: you know, ways that we approach punishment. And we ended
Speaker 1: up at my restaurant, Homeroom adopting a system that I
Speaker 1: had seen used in the criminal justice system called restorative justice. So,
Speaker 1: you know, most stuff at work, when someone screws up,
Speaker 1: you just get punished. You maybe get a write up,
Speaker 1: you maybe get doc shifts, you know, things like that.
Speaker 1: And with restorative justice, the idea is actually it's not
Speaker 1: to punish people, but to make it right. And so
Speaker 1: we started shifting from like punishing people when they screwed
Speaker 1: up to you know, walking them through this restorative model
Speaker 1: of figuring out how to make it right with staff,
Speaker 1: you know, like how to you know, apologize like do
Speaker 1: nice things, fix it with the customer, you know, help
Speaker 1: your manager, like really make it right. With all the
Speaker 1: people affected by their behavior, and it was a real
Speaker 1: sea change for us. You know, it was really helpful.
Speaker 3: Aaron, you dropped something like an elephant in the living room.
Speaker 3: We have to ask you, So you worked with Kamala
Speaker 3: Harris or it sounds like you have some experience what
Speaker 3: what would you what do you think some our audience
Speaker 3: in your experience with with working with her or dealing
Speaker 3: with her or talking with her that you think is
Speaker 3: worth sharing.
Speaker 1: Oh gosh, I mean I do think you know, she was.
Speaker 1: I mean I had worked for her because I was
Speaker 1: really drawn to she was doing stuff that at the
Speaker 1: time was considered pretty out there, and you know, so, yeah,
Speaker 1: I have tremendous, tremendous respect for her, and you know,
Speaker 1: fun that she's running for president right now, So I yeah,
Speaker 1: I guess I just say, I think I really respect
Speaker 1: that she has tried things that other people weren't willing
Speaker 1: to do. Frankly, at the time, I don't think she
Speaker 1: gets much credit for that, but she's an innovative prosecutor
Speaker 1: and she's good at what she did.
Speaker 3: Well, be sure to keep us up to date on
Speaker 3: what you do with homeroom, especially if you expanded out
Speaker 3: and grow and we love talking to certainly small business owners,
Speaker 3: but your path has really been an interesting one and
Speaker 3: thanks for sharing it. Aaron Wade, chef and entrepreneur, I
Speaker 3: guess I can say also a lawyer or former lawyer.
Speaker 3: Her book is The MC and Tee's Millionaire Building a
Speaker 3: Better Business By Thinking Outside the Box. Joining us from Oakland, California.
Speaker 3: All right, we're going to get back to a topic
Speaker 3: that is something Billy, thank you, a topic that we've
Speaker 3: talked about a lot in the last twenty four hours.
Speaker 3: It being Climate Week here in New York City. We
Speaker 3: have the U in General Assembly underway, but climate was
Speaker 3: a big topic of discussion at our Bloomberg event yesterday,
Speaker 3: the Global Business Form and also the earth Shot Prize
Speaker 3: Innovation Summit. And we're going to continue that conversation because
Speaker 3: there's a new study out from Deloitte.
Speaker 2: Yeah right, this is the twenty twenty four AMXO Sustainability
Speaker 2: Report from Deloitte, and we've got Deloitte's Global Sustainability and
Speaker 2: Climate Practice leader, Jennifer's Simon here with us in studio.
Speaker 2: Great to see you, Jennifer. Thanks very much for coming
Speaker 2: in to talk to us. This is an interesting time
Speaker 2: to be thinking about how c suite executives are thinking
Speaker 2: about the sustainability, not only because we're looking ahead towards
Speaker 2: the US election, but also we're in this kind of
Speaker 2: a very interesting moment economically as well. I mean, what's
Speaker 2: the kind of top line out of your report? Is
Speaker 2: this an issue as prominently being considered at that level
Speaker 2: as it has been in read years?
Speaker 4: Absolutely, it's such an interesting study. Third year running, twenty
Speaker 4: one hundred cxos surveyed across twenty seven countries, and given
Speaker 4: the backdrop of what we're facing currently was it would
Speaker 4: be interesting to look at the trend over three years,
Speaker 4: and what we're seeing is that this is still a
Speaker 4: top of mind priority for cxos. What are cxos so
Speaker 4: sea level individuals be a CEO? Great questions? Throw a
Speaker 4: little bit of jargon there, I don't even guess.
Speaker 3: I'm like, what are we talking about?
Speaker 1: Okay?
Speaker 3: So what's interesting is we talk about this all the time,
Speaker 3: that when certain things get to the c suite level,
Speaker 3: whether it's technology, whether it's we talk about the CFO.
Speaker 3: Now it's not just about earnings reports. The CFO is
Speaker 3: very involved in strategy. How do we spend money at
Speaker 3: a company working with the CEO, So you're saying, you know,
Speaker 3: or whether it's you know, personnel issues, whether it's equality, diversity.
Speaker 3: We've seen the ramp up, we've seen the dial down
Speaker 3: on that. What about sustainability do we you know, has
Speaker 3: it been consistent or do we see it kind of
Speaker 3: waivers sometimes depending on the priorities of what the C
Speaker 3: suite's all about.
Speaker 4: Over the last three years, it's been a top three
Speaker 4: area of priority, which is really interesting. So we see
Speaker 4: it flip flopping a little bit, but always in the
Speaker 4: top three. And this year only there are two areas
Speaker 4: that we're head economic outlook, which makes sense, and then
Speaker 4: also technology and read into that AI and data some
Speaker 4: of the topics you've been covering before this, and so
Speaker 4: those things are integrated but really high priority. And then
Speaker 4: the spending at we ask the question, how much are
Speaker 4: you going to spend on this? Are you going to
Speaker 4: increase spending this year? Up from seventy percent saying they
Speaker 4: were going to spend more, we're now at eighty five
Speaker 4: percent of the C suite saying they're going to spend
Speaker 4: more on.
Speaker 2: This topic, and that speaks very clearly to what sort
Speaker 2: of motivation these C suite executives have in being interested
Speaker 2: in subtainability as well. I mean, is that because they're
Speaker 2: worried about the impact on their businesses? Is this a
Speaker 2: reputational issue? What's motivating that increased investment?
Speaker 4: There certainly has been that kind of concern from a
Speaker 4: traditional perspective, but this year, for the first time, we're
Speaker 4: starting to see a shift. So risk management very important,
Speaker 4: thinking about the doing good part of the equation very important.
Speaker 4: Compliance is another topic with the regulatory environment globally continuing
Speaker 4: to kind of continue to scale up. But for the
Speaker 4: first time, what we're seeing as people are starting to
Speaker 4: see an economic upside, so they're starting to integrate this
Speaker 4: more deeply into their strategies core to the business, not
Speaker 4: of what I call a side order of sustainability, but
Speaker 4: how do we make money doing this?
Speaker 2: This is also a question of the you know, the
Speaker 2: chief sustainability officer often somebody not in the inner circle
Speaker 2: of decision making and businesses as well. The range of
Speaker 2: people that you're surveying is this kind of getting to
Speaker 2: everyone up to CEO level.
Speaker 4: Absolutely, we looked at the entire c suite, so across
Speaker 4: many all industries, effectively all geographies a large scan. So
Speaker 4: this is absolutely something that's becoming more of a c
Speaker 4: suite conversation, more of a boardroom conversation as well, and
Speaker 4: you start to see CFOs taking much more interest because
Speaker 4: as we start to look at the regulatory environment, we'll
Speaker 4: start to see a shift into having to do more
Speaker 4: around non financial disclosures as well as financial dis Well.
Speaker 3: This is where I wanted to go because you said
Speaker 3: top priority, it's an action item or it's top priority.
Speaker 3: There's lots of conversations, So there's conversations how much money
Speaker 3: that was really being spent towards it. I'm just curious
Speaker 3: where that stacks up when it comes to the expense
Speaker 3: line on a balance sheet, because I know when we
Speaker 3: break down earnings of a publicly held companies, I'm not like, hey,
Speaker 3: look look what they spend on sustainability initiatives. That's going
Speaker 3: to make investors say, oh, I want to own that stock.
Speaker 3: So help me out here and understand where kind of
Speaker 3: the rubber hits the road on this.
Speaker 4: Yeah, it's a great question because we do see there's
Speaker 4: an uptick, right everyone plans on spending more, but I
Speaker 4: think you have and.
Speaker 3: It says they're going to spend more, but it feels
Speaker 3: kind of hazy and a lot of gray out there.
Speaker 4: We need to combine that with things because if you
Speaker 4: look at other priorities, So one lipnus tests is are
Speaker 4: where you want to spend more of that money, and
Speaker 4: it's going more towards operational issues, which which which means
Speaker 4: we're getting into the company's supply chain and how are
Speaker 4: we doing things, how are we working, how are we
Speaker 4: being more effective? Didn't really hear conversations around effectiveness a
Speaker 4: couple of years ago, So now they're seeing a potential
Speaker 4: for being more effective and makes you more comfortable spending
Speaker 4: money because you think there's going to be a return
Speaker 4: on that investment in the other areas technology. So a
Speaker 4: lot of the problems that need to be solved come
Speaker 4: through technology integration. And so you combine the innovation and
Speaker 4: technology language that we're hearing from the CXOS to the
Speaker 4: increase here and it's often running.
Speaker 2: How much is regulation playing a part in this? Because
Speaker 2: you know you have the new Corporate Sustainable Ability Reporting
Speaker 2: Directive in the EU for example, we know that a
Speaker 2: lot of EU rules are you know, the Brussels effect,
Speaker 2: These things spread around the world as well as standards
Speaker 2: are set. Is this that kind of is the character
Speaker 2: or the stick motivating the change and attitude that you're seeing.
Speaker 4: I think it's both. And when you start to look
Speaker 4: at the regulatory environment, it's quite a bit and it's
Speaker 4: a lot for companies to adopt. I was sitting at
Speaker 4: a breakfast with a lot of CSOs and there are
Speaker 4: fourteen different regulations that I need to comply with now.
Speaker 4: But part of it is collecting that information so that
Speaker 4: we can have better transparency and then when you have
Speaker 4: that data and information, you can do more with it.
Speaker 3: Well, okay, so a couple things. Sorry I'm playing like
Speaker 3: Devil's advocate here. But sustainability, I mean, we keep talking
Speaker 3: about conversations with AI and how it's going to replace workers.
Speaker 3: Sustainability of a workforce? Is that coming up among individuals?
Speaker 3: And then also everybody's spending on AI ramping up their
Speaker 3: data centers. That has a huge environmental impact, right, the
Speaker 3: energy needed to do so how is that being worked
Speaker 3: into these conversations?
Speaker 4: And you can see from the topic it's ever expansive.
Speaker 4: So the greening of AI is required, and then we
Speaker 4: also need AI to green so we're going to have
Speaker 4: to look at those things together. And there's a lot
Speaker 4: of work that needs to be done as we continue
Speaker 4: to increase energy consumption around that area. But most organizations
Speaker 4: are trying to tackle these problems one at a time,
Speaker 4: and it's really a systemic view that you need to
Speaker 4: get it done. And that's part of it with the
Speaker 4: regulatory question. What about for workers though? If we're for
Speaker 4: workers absolutely who.
Speaker 3: May not have a job because technology. You know, we
Speaker 3: just talked about what junior lawyers right are looking at
Speaker 3: contracts and different things. We had a segment was it
Speaker 3: last week?
Speaker 1: Were you here?
Speaker 2: It was here? And it was this week? It was Monday.
Speaker 2: It's Wednesday, Carol.
Speaker 3: This is the kind of week it's been, right, But
Speaker 3: I do wonder about worker sustainability, and it has to.
Speaker 4: Be included when you think about the broad definition of sustainability.
Speaker 4: Workers included. In the study we looked at workers as well.
Speaker 4: We also have another study where we looked at the
Speaker 4: job impact of the transition, and we need to look
Speaker 4: at that collectively because jobs are on the line, not
Speaker 4: just for technology but sustainability as we look at it.
Speaker 4: But there's optimism too, because there's so many new jobs
Speaker 4: being created with a new sustainable economy, and you start
Speaker 4: to think about not just what are those jobs, but
Speaker 4: how do you do a just transition so that as
Speaker 4: many people can have access to those opportunities as possible.
Speaker 2: That's the optimism. How much fear is there among c
Speaker 2: SWEDE executives about what changing climate and everything that's coming
Speaker 2: with it is going to affect their businesses.
Speaker 4: Well, it's interesting because we've seen optimism go up, and
Speaker 4: I actually think if you look around New York this week,
Speaker 4: there's so many more businesses involved. Every year it ramps up,
Speaker 4: so we're having a lot of conversations around the business side.
Speaker 4: Business is taking action. So when we looked at the study,
Speaker 4: there's ninety plus percent optimism around we can have a
Speaker 4: positive impact and also generate revenue which leads to jobs.
Speaker 3: Twenty seconds left. Doesn't matter who's in the White House
Speaker 3: with all of this.
Speaker 4: No, this train has left the station. Most organizations have
Speaker 4: decided to do this, and not just in the United
Speaker 4: States but globally.
Speaker 3: Well, this is what I think is important. You mentioned
Speaker 3: like I feel the US is taking cues from what's
Speaker 3: going on in Europe in a big way. When it
Speaker 3: comes to sustainability and greener initiatives, and then if you're
Speaker 3: a global company, you've got you have to be.
Speaker 2: Able to operate. It's a massive market. You need to
Speaker 2: need to buy theirals. Jennifers, so great to have you
Speaker 2: with me. Thank you for taking us through the details.
Speaker 2: Jennifer steinmon there, who is Deloitte's global Sustainability and Climate
Speaker 2: Practice leader. Really interesting to dig into. It's Climate Week,
Speaker 2: we're talking about sustainable This is again coming back to
Speaker 2: the business case has been made? Is everyone seeing it?
Speaker 2: Is it feeding through two invests?
Speaker 3: Yeah? Absolutely, And you do feel like it's not just
Speaker 3: a case of doing well doing good if you think
Speaker 3: about it in terms of choices made by executives, but
Speaker 3: it's really just the business case being that it just
Speaker 3: makes sense in terms of where the world is going.