Season 2, Episode 11 - Game Changers and Transition Makers: How ESG writes the rule book for this printing giant

Lorraine:
Hello, and welcome to ESG Matters @ Ashurst. You're listening to the second season of Game Changers and Transition Makers. I'm Lorraine Johnston, partner at Ashurst in London, specialising in ESG regulation. In this series, we meet global entrepreneurs who are embracing disruption to boost business performance and drive the sustainability agenda. In today's episode, you'll hear my conversation with Taran Rai, the corporate sustainability manager at Epson UK, an organisation on a mission to use technology to help overcome global environmental problems and other societal issues to enrich people's lives and make a better world. And so without further ado, let's jump in and hear the discussion.

It is really lovely to meet you, Taran, and to hear a little bit more about Epson. Let's start from the beginning. Could you tell us a little bit about yourself, your role and the business?

Taran:
I am the sustainability manager for Epson UK and I have a counterpart in a lot of different countries. So we're technically Epson Europe, but I will have counterparts in Spain, and Italy, and France, and Germany, and we all work together as a part of a team that sits in Europe. I think there's around 13 of us. We cover a lot of different areas. So we have a chemical compliance team. We have an environmental compliance team. We have a team looking at things like our waste as well.

So overall, even though I sit in the UK alone as a sole function, I sit as part of a wider team across all of Europe as well. Now, my job itself is split into a couple of different roles. I think that any sustainability manager wears a lot of hats when they've sat in their role as well. One of mine will be I scan the regulatory horizon essentially. If there's legislation coming up to the environment that directly impacts Epson, directly impacts the UK, that's something I'll need to flag up to my counterparts, for example in Europe, just to let them know as well.

That is definitely a challenge for me because when I first started off, I didn't have any experience in this. So quite quickly I was able to grasp the understanding of, "Okay, so this is what it means when someone's talking about a legislation or a regulation." But it's been really interesting actually to learn that side of things because I never thought I'd go into it, but actually I quite enjoy keeping a track of everything and making sure I was like, "Oh, there's a new development here, a new development there." And doing lobbying practises and stuff like that.

Also, as part of that is our support for our sales teams. So first and foremost, we are a sales company, so we'll be selling things. And the way to do that and the way that my role fits into that is that when the sales guys go into a meeting or something, and there is that conversation around sustainability of a product or sustainability of the business or talking about our sustainability strategy as well, I'll often come to those meetings and I'll sit in them and I'll provide that expertise for them so that the sales guys can do their stuff and talk about the product of which I have no idea, and then I can do my stuff and talk about sustainability, of which they might not have a clued-up idea either.

So really we go hand in hand together, and I think that that's really important and that whenever I watch the sales guys do their thing, I'm almost in awe because I'm like, "I started this company and this company knew nothing about printers." And even though I've learned a little bit along the way, it's nowhere near their level of knowledge as well. So we're there to really help each other as well.

And then on top of that too is the sustainability advocacy. It's essentially being a spokesperson, I guess, to people within the company who maybe feel like they don't have an impact on sustainability or they're wondering how does my job role directly impact sustainability for the company? I'm able to come forward and whether it's things like initiatives and whether it's speaking to them and helping them understand whether there's training, I'm essentially the advocate for sustainability in the UK. So I'll really help people along the journey there too.

Lorraine:
And so I guess one of the questions is how did you get into sustainability?

Taran:
I did environmental geology when I was in university, and I was there and I was like, "Wow, I love the physical side of geography, but I'm not sure I wanted to do it for a degree for three years." But I got to the end of that and I was like, "I think I want to interact with people a little bit more instead of just going and hiking up mountains." So what I did is I got a job when I came out of uni at a packaging compliance company, and I was a technical advisor there, so I'd be on the phone to a lot of big names.

I would be doing things like giving them advice about how they can ensure that their data is correct, ensure that they're compliant and everything. But it was a very niche industry in itself, and I realised I wanted to take a step back and I wanted to look at it from a broader outlook so that packaging compliance wasn't the only thing I was looking at. I was also looking at multiple other things as well, especially in the human side of sustainability and the social side of it, and also looking at, "Okay, how can I help a company get further on that journey itself?"

So I quickly moved myself from that job where I was there for four years, I think, gained a lot of experience, learned a lot of things there, was able to take those transferable skills into a new role at an oil and gas company as a sustainability executive. And now that was a challenge and they weren't a bad company by any means, but you can tell when you go into an industry like that, often sustainability is seen as the enemy whereas for a lot of other companies, sustainability is seen as a benefit, as something that can help the company.

So it was really interesting to see it on both parts there where packaging compliance was maybe not sustainability, but looking at a positive wave impact in the environment and then going into an oil and gas company where perhaps the impact wasn't as positive, but we were trying to do better and trying to do different things.

I then moved to Epson, and that was a really refreshing move in itself because I went from going from a company where maybe sustainability wasn't talked about enough to a job where sustainability, instead of being chucked out the room, I was invited into the room. And our MD really thinks it's important to talk about things like sustainability. So he'll invite me to management meetings, for example because he thinks that almost takes as much importance as what the sales numbers are for that quarter as well.

So that's great, and I really do appreciate having a job where I can go in and have, I guess, in one of a better word, the respect for what my job does and how it helps the company. That has been great. And obviously you're going to meet your pitfalls and people along the way who are, "What's the point of sustainability?" If they're going to ask that question. But all of it is about having the skills to almost persuade them to help them understand how it's going to directly impact them and how maybe they don't see it right now, but there is a benefit for the company in long term as well.

Lorraine:
What an incredible journey that you've been on, and there are so many things that I want to pick up out of that, to be honest. That comment that you made that instead of chucked out of the room, you've been invited into the room, what an amazing opportunity and what an amazing place. Turning to Epson itself we're seeing in terms of a lot of companies is technology and how technology is driving sustainability. Could you tell us a little bit more about Epson tech?

Taran:
Yeah, sure. More than anything else, and first and foremost, we are a printer company. We do a lot of other things as well. So we do projectors, we do receipt printers, textile printers, watches. We do glasses that the National Theatre uses for possibly people who are attending who are hard of hearing, who perhaps can't see the stage or can't hear what's on the stage. They have little subtitles that come up at the bottom of the glasses. A bit like a Google Lens for example.

So yes, there's a lot of applications that we do have for Epson tech, but going back to printers, for us, more than anything else is at the core of our products is something called Micro Piezo technology. Now, there's a bit of a story here. If I take you back to 1964 to the Tokyo Olympics, as a company, we were a watch manufacturer, first of all. So Seiko watches, you will have heard of them as Seiko Epson. So Seiko watches were something that was very much already an established company within Japan and during the Tokyo Olympics, they were asked to be the timekeepers for the 1964 Olympics.

Now, as part of this, and as timekeepers, they had to keep a track of, "Okay, when do athletes cross the finish line, for example, when do they complete a lap?" Because obviously it's the Olympics, it's very important. It had to be very accurate. So what they created was EP101, which is electronic printer 101, and it's essentially an electronic printer. I think it was around the size of a credit card. And what it did was print out times.

It was connected to a Seiko Epson time watch, large time piece, I guess, and it printed out the times accurately for when athletes passed a finish line. Now, Epson saw this and they... Or rather Seiko saw this and they were like, "Okay, what can we do with this?" They tinkered and tailored and they created a new generation. And they created I guess a second version of EP101, and they called it EPSON, and if you look at how that is connected as a name, it's Epson. So that's really where the name Epson came from, and that's why we asked Seiko Epson.

But because of that, so that printer is so important because we use Micro Piezo technology in it. So usually Micro Piezo technology is used in watches. It is a very good way of timekeeping because a crystal naturally oscillates. So Piezo is a piezo crystal, and what happens is if you pass an electric current through a crystal, you can control the oscillation that happens. You can control the rate at which that crystal pulsates for example. And the reason why that's important for printers is that what we're able to do is bypassing a very small electric current through these crystals, we can put these crystals onto a printhead.

We can put thousands of crystals onto a printhead, and that means that only a little bit of electricity has to run through all these crystals to be able to essentially jet ink onto a piece of paper, onto a page. Now, that's different to traditional ways of printing. If you think about your own printer that you might have in the office, for example, if you take it out the printer, you set your print job to the printer, you go to the printer, it makes a sound like a whirring sound, and then you get your piece of paper out, and it's very nice and warm, and you're like, "Oh, look, I have a nice warm piece of paper." Like when you take your clothes out to the tumble dryer.

But this is, if you think about it, logically now, you are taking out a hot piece of paper that the ink has been baked onto that piece of paper. You have to think about how much energy has gone through trying to heat up that device to such a temperature where the ink can be baked on, where you get a warm if not hot piece of paper out of it at the end. Now, you think about that. Honestly, I think for a lot of companies and a lot of businesses, if they're going to print something out, maybe it's two, three pages max.

Nobody is printing out reams and reams and hundreds of pages of reports these days, unless you are, in which case, fine. But a lot of companies are only doing one page at a time, and if you are having to heat up a printer for just one piece of paper, then how much electricity is going into that as well? A lot of companies say the solution is to stop printing altogether. But the matter of the fact is that we still need documents. And you don't need a printer until you need a printer, whether it's for your passports, whether it's for land deeds, for example, when you're buying a house, whether it's money, whether it's newspapers, printers are still being used in our every day.

So our challenge to that always is that we know that printing maybe isn't the most sustainable industry, but why not when you are printing, you try and do it sustainably? You try and do it in the most sustainable way possible as well, and that's through using something like an inkjet printer that Epson makes as well.

So it's really, really important to us that customers try to understand that nuance of, okay, when I'm making a buying decision, I need to know a little bit more about how the tech works so that I can understand, okay, is this really good for me? Is really good for my pocket? Is this really good for the planet? And really having that three tiered thinking as well when it comes to buying things.

Lorraine:
Are there any other use cases that you're seeing develop with Epson tech?

Taran:
For us, I think that innovation is a really important part of it, and we're really fortunate to own the whole process from start to finish. So not only do we do the R&D and the creation of a product, we manufacture it and we also sell it as well. So the benefit of having that entire supply chain controlled by us means that if a customer has a want and a need, we're able to almost try and tinker and tailor what tech we already have, try and meet that need.

One example of that is we work with a fashion designer called Yuima Nakazato. One thing we've created that's helped in a partnership with him is something called dry fibre technology. Now, originally, dry fibre technology was intended for the purpose of localising and miniaturising the recycling process for paper. So usually when you recycle paper, you have to send it over in massive bins over to a factory where it gets mixed with water and pulped and gets cleaned, and then the water is drained. It's a very water intensive process in itself.

So what we did is we wanted to create something that offices could have in the corner of their office and they could essentially put a piece of paper, whether it's a document that they need to get rid of that they were otherwise going to shred, or maybe it's just a piece of paper, a stack of paper that they need to get rid of. They can put it through this Epson tech, and at the end of it, they can have a piece of paper, which is virtually new, and it's been through this virtually water free defibration process.

I do massive injustice as to how the technicality of it works, but essentially it pulls the paper apart, bonds it back together, and then flattens it and sends it out the other side. So we are on the second iteration of that that now called the PaperLab. But that technology itself has been really interesting because we have been using that technology to create ink pads for our printers.

So you only have ink in a printer. You need to absorb that ink. We've been using that recycling process and using that technology to create those ink pads. But also what we've done is we've realised that there's applications to other industries as well. So we've been working with Yuima Nakazato, a fashion designer. And what we've done is we've taken landfill from Africa, textile landfill from Africa. We've put it through this defibrillation process, and we've been able to create the virtually paper-free reamer fabric that Yuima Nakazato has been using for some of his designs.

And it's actually featured at Paris Fashion Week for the past two, three years, I think. It's really fun to understand, okay, we are also having an impact in another industry as well, not only our own too.

Lorraine:
That's amazing and just incredible how you've taken your core processes printing and then looked at different scenarios and different use cases as well, and also how to do it differently, but in a sustainable way. I have so much to take away from that and think about, and I am going to go and examine our printers back at the office a little bit more closely as to what technology we use and how that could be adapted more sustainably in the future. So thank you for that.

Taran, I guess one of the focus at the moment is around about sustainability reporting. What do you do in terms of sustainability reporting and how do you measure success for yourselves?

Taran:
Yeah. So we have a sustainability report that we put forward every single year for Europe and it's a great piece of being able to show not only our external stakeholders, but also the internal ones as well what is happening. And something that I'll do within the company is I'll run training on the sustainability report where I'll invite the entire company in the UK and I'll take them through each and every... Well, not each and every page because that will take a very long time because I think it's around 64 pages long. But I take them through, I guess an overview of what's happened, sustainability report, because I think it's important for us, even though we say to ourselves, "Okay, we find that sustainability important."

There'll be people sitting in our finance department, for example, who have no idea what's going on because they only see the numbers at the end of the day. So going through that sustainability report with everybody and saying, "Okay, so these are developments from last year. This is how things have changed," is really important for us in that sense. When it comes to the sustainability report, we're lucky enough to have a third party verified.

So we'll have Bureau Veritas look through it, verify and make sure the data is assured and everything, so that when we're putting that sustainability report out, we know that we're putting the most important information, the most accurate information out there for our customers to see and for our stakeholders to see as well.

In terms of measurement, so we really try and split our sustainability report up into a couple of different areas, looking at things like decarbonization, looking at innovation that we have, looking at things like secular economy. So we've tried to focus in on targets that we've set in each of those areas, things like electricity consumption. So we are a company that is a hundred percent renewable and we use a hundred percent renewable energy. And that's no easy feat in itself, and one thing is achieving that. Another thing is trying to maintain that as well.

So within our sustainability report, we show how the trend of energy consumption has decreased for us, for example. Not even energy consumption, sorry, the carbon emissions associated with that energy consumption as well. So prior before we used to have a graph, I guess, showing that how high amounts of consumption, high amounts of carbon emissions since moving and switching over to renewable.

Obviously, there was a bit of a dip during COVID-19 anyway as there was for every single company. But since then, moving to renewable, we've been able to see carbon emissions decrease. And not only that as well, not only has our carbon emissions decreased down, we've also been able to have a look at our energy consumption and bring that on a downward trend as well, which is so important because I think everybody thinks, "Okay, sustainability is just about taking up the carbon emissions of everything, making sure everything is net zero. But it's also looking at where can I reduce where I use, for example. So things like carbon emissions, sorry, electricity consumption, even. How can I reduce the amount of electricity I'm consuming?

Lorraine:
It's amazing how you've developed that tech and in particular to... that will help certain use cases, but also driven from a place around about looking at your products, looking at your supply chains, looking at your, as you say, your circular economy and your decarbonization journey. And actually, I think that's what we're seeing a lot of in the market is that some companies are not just now focused on that sort of core product offering, but sustainability is driving a much more creative and considered view of the entire process of the entire supply chain and looking at your waste and what is achievable there.

And actually sometimes in a lot of cases there's added value because you can take waste and you can actually then repurpose it in certain ways and create other sort of product lines as well. And it sounds as if that's exactly what's happened in Epson tech.

I guess, what does success look like for you? How do you measure success and how does that,... You talked about year on year improvement. What's the bigger picture and what's the macro picture?

Taran:
Yeah. So for us, I think that it's definitely being able to show our customers that we're not just talking the talk. We're able to walk the walk as well. And for us, that's having things like EcoVadis Platinum, for example. As far as ESG ratings go, I think it's pretty high up there on respectability for suppliers. You can go and you can search any company, you can have a look, "Okay, what is their sustainability credentials? What is their rating when it comes to EcoVadis? How are they looking at things like sustainable procurement? How are they looking at the environment, human rights, ethics, for example?

So we complete that exercise every year, and it's something that we hold and we hold very close to our hearts, I think especially across the entire company. If you go to somebody who works in a different department like facilities, and you say, "Okay, do you know about EcoVadis?" People within the company will know about EcoVadis because it's so important to us as well. And being able to achieve the highest rating on that is important to us.

So what we've been able to do is we are EcoVadis Platinum. Obviously, that is a challenge in itself because you have to maintain EcoVadis Platinum, which is always hard because the marking criteria for EcoVadis is always changing, constantly trying to force companies to do better. And maybe forcing isn't the right word here. It's trying to encourage companies to do better as well. It's trying to show them, "Okay, look, the only person that you should compare yourself against is yourself the way you were last year."

And that's something that we try to do as well. We try to have a look, "Okay, are we making sure that our marks are going up and they're remaining where they are? If not going up, can they stay where they are stationary because we're able to do things and implement things into our business strategy, into our sustainability strategy. They're really focusing on those areas like sustainable procurement, like human rights, for example.

So it's so important to us, and I guess we're lucky enough to hold EcoVadis Platinum in a position like that whereas I've worked in companies where they haven't held that status, but they're still... Even if they're bronze, they still understand how worthwhile it is having something like that in the first place. And it doesn't mean you have to be right at the front of the leaderboard to be sustainable, but I think that it's all about that journey that you're taking to really put yourself on a map of sustainability and make sure that you're going towards and you're working towards something better for the future as well, better for your company and better for future generations. So yeah, I definitely think that Ecovadis has been a great way of us measuring that success for ourselves as well.

Lorraine:
And I think that's an incredible way to have that continuous improvement, particularly on sustainability, and it makes it very tangible when you can see year on year either that maintenance of EcoVadis Platinum or other external certification regimes. You mentioned that you work amongst a network of sustainability professionals in Epson, in Europe. What are some of the challenges and opportunities there? Because I guess we're in a period just now where there's a little bit of a change in policy direction and people are a little bit uncertain, I guess, as to the shape of the future in sustainability. Certainly from a regulatory point of view. How does that operate? And how do you communicate and understand each entity's point of view? How does that work?

Taran:
So I think that something to be said about a sustainability role is that, and this may be a controversial view, but the way a sustainability role should work and function is that it should essentially be rendered obsolete in a company. Because the idea is that I am an advocate for sustainability, but technically in a perfect company, in a company like Patagonia, for example, sustainability is ingrained in everything they do.

So there is no subject matter expert because everybody is a subject matter expert. And I think that even though that might be like, "Okay, I'll go get fired at the end of the day because I no longer have a job because I'm obsolete," that kind of stuff, I think that it is really important for people to understand that I came into this, especially into sustainability, when sustainability is very much new.

In terms of job roles, it's a very new job role. There is always something to be done with sustainability because it's so broad and because it covers so many different areas. I'm not even looking at the environment, I'm looking at things like the social side of it. I'm looking at health and wellbeing as part of it, all that kind of stuff as well. I'm looking at the compliance of things.

So there's always stuff to be done because sustainability is so far stretched across so many different industries. And so many different functions as well. So the idea is that if we're able to integrate sustainability into different departments and help people have that mind shift change, that then sustainability becomes part of everybody's role and becomes part of everybody's life because who knows the department better than the people working within it?

I won't be able to give, I guess, far enough technical advice to someone who works within... I know, again, the sales company, the sales department for example, they'll know it better than anybody else. So them being able to understand how sustainability works allows them to implement different things into their day-to-day life that will make it more sustainable. Especially when it comes to a regulatory horizon, there's a lot of changes happening at the moment.

I think, obviously, we've got CSRD coming up. For a lot of companies, that's always a bit stressful in itself as well, especially now that the EU is looking at combining some of those areas to that alphabet soup, I think they call it. Very true. But I think that there's always a role, especially because regulatory developments are really trying to push sustainability forward and ingrain it into a company's every day.

I think there is always a role for sustainability in some capacity because there will be so many things that a company needs to do in order to just be on the market in order to just be compliant. And I think you really think it's important that customers more than anybody else are understanding the value of that because you could... For some companies, they put out a CSRD report, for example, or sustainability report because that's what their investors are looking at. That's what their external stakeholders the board is looking at, for example.

But I think it's really important for people in their everyday lives as well to understand what it means when a company is talking about sustainability. Because I could go out and I could buy something and I could be giving money to a company.

And I'm not essentially giving money in order to get something back. I'm giving money to a company that perhaps isn't sharing the same views as I am. And I think that we're all quite naive sometimes where we're like, "I want something. I want to buy it from here." But we're not looking at, "Okay, what is that company doing? What's the ethos of that company either?" So I do really think it's important that not only is sustainability a function within a job role, but also a function within our everyday lives as well.

And I think that where sustainability manages and the sustainability function can come in useful is trying to bridge that gap between the technicality of a business and then speaking to customers and speaking to consumers and saying, "Okay, this is what it actually means." Putting it into layman's terms, for example, so that they can understand what is a company doing and why is it important to how they function in their everyday life, and how will it impact them in the world that they live in as well.

Lorraine:
Listen, it's been fantastic talking to you. It really has. I've learned so much, not only about you, but also about Epson, and I've got so many takeaways from it, so I really appreciate your time.

Taran:
Oh, thank you very much, Lorraine. Thank you very much, and thank you for inviting me on the podcast as well.

Lorraine:
Thank you for listening to this episode of ESG Matters @ Ashurst. I hope you found this episode engaging and inspiring. To subscribe to future episodes of Game Changers and Transition Makers, and to hear previous episodes, click on the link in the show notes or search ESG Matters @ Ashurst on Apple Podcasts, Spotify, or wherever you get your podcasts. And while you're there, please feel free to leave a rating or a review. And finally, to learn more about all Ashurst podcasts, visit ashurst.com/podcasts. In the meantime, thanks again for listening and goodbye for now.