Responsible business key to global growth, says Malabar Group's MP Ahammed

Kochi: Environmental, Social and Governance (ESG) principles are no longer merely a matter of corporate responsibility but a business imperative, Malabar Group chairman M P Ahammed said on Saturday.

Adherence to ESG principles is essential for building a socially responsible enterprise and expanding a business across diverse cultures and markets, Ahammed said while speaking at the session ‘Growth with Purpose’ at the Manorama Conclave in Kochi. The conclave is being held on the theme ‘Kerala@70’.

Ahammed said every business enterprise had a responsibility towards society and should extend a helping hand to people facing hardship while pursuing business growth. Maintaining the trust of the people, he said, was essential for sustainable success. A proper governance system and standard operating procedures (SOPs) could ensure strict adherence to environmentally sustainable policies and practices, he said.

“We do not want to align with anything that affects environmental interests,” Ahammed said, referring to the gold business and the concerns sometimes associated with it. Malabar Group sources gold directly from responsible mining companies, thereby ensuring that its sourcing practices remain socially and environmentally responsible, he said, also mentioning that the group had a clear policy of undertaking social responsibility initiatives for people struggling with various difficulties, including financial crises.

Pointing out that a portion of the group's profits was earmarked for social service activities, with one such initiative being the feeding programme operated through its shops, Ahammed said trust, compassion and compliance were the key pillars of a successful business. Businesses must keep the promises they make to customers and society, he said.

He also noted that ESG-oriented businesses received considerable support in markets such as Europe, Australia and Singapore, where consumers increasingly value responsible business practices.

Speaking about changing consumer preferences in international markets, Ahammed said Asian countries, particularly India, remained major consumers of gold ornaments. Diamond jewellery, meanwhile, had strong demand in European markets.

He said jewellery preferences and designs vary significantly among communities and countries. Malabar Group has a research team that studies the preferences and demand patterns of different communities in various parts of the world, he said.

At the same time, Indian art and jewellery designs have a huge demand globally, Ahammed said, adding that the group had succeeded in taking Indian designs to international markets. On Malabar Group's proposed initial public offering (IPO), Ahammed said the group was working towards amalgamating all its companies into a single entity before proceeding with the IPO.

He said around 22% of the group's investors were employees and that steps were being taken to ensure the safety of their investments. The group aims to build an Indian brand with a global presence and expand its footprint across the world, he said.

Recalling the origins of his business journey, Ahammed said his father had wanted him to become a teacher. His father was a school manager, and teaching, he said, enjoyed considerable social recognition. However, after completing his graduation, Ahammed entered business following a suggestion from a friend in Mumbai to invest in gold and land at a time when the value of the rupee had fallen in the 1990s.

Quality soon emerged as a major challenge in the gold business, he said. Malabar Group responded by introducing 916 and hallmarked gold ornaments, with “Beauty meets Quality” as its slogan. “After 2000, we sold only hallmarked ornaments,” he said.

The group has also focused heavily on design and manufacturing. Ahammed said around 200 people were deployed in its design division and argued that in-house manufacturing was crucial to ensuring perfection in jewellery.