During a session on “Financing the Climate Transition” at the B20 Summit India, Uday Kotak, MD & CEO of Kotak Mahindra Bank, highlighted the necessity of prioritizing the existential viability of Earth in the face of climate transition. He emphasized the need to shift from a focus on capital that expects immediate returns to a mindset where capital is willing to absorb losses in pursuit of sustainable development.
Kotak stated, “We have no choice but to go beyond the capital which expects returns to capital which is ready to take losses.”
He further emphasized that safeguarding the risk of Earth’s existential viability should take precedence over business viability. This perspective underlines the urgent need to address climate challenges and transition towards more sustainable practices.
Uday Kotak’s recent suggestions align with his ongoing efforts to promote sustainable development and meet social development goals. He proposed that companies worldwide contribute 0.2% of their annual profits to the Global Acceleration Fund, aiming to raise around USD 4.5 trillion in the next 7-10 years to support development priorities.
Kotak explained, “What we are proposing is every business contributes 0.2 percent of profit to social development goals which are a priority for the world.”
This recommendation emerged from the B20 India Task Force on Financing for Global Economic Recovery, which Uday Kotak chairs. The task force is expected to present its recommendations to the G20 during the Leaders Summit in New Delhi on 9 and 10 September.
In terms of implementation, Kotak suggested that the 0.2% contribution for social development goals could come from the 2% allocation that companies commit as part of their corporate social responsibility (CSR) initiatives. He believes that this contribution to the global fund aligns with businesses’ responsibility to support sustainable development efforts.
Uday Kotak’s holistic approach underscores the importance of considering both short-term economic feasibility and long-term sustainability when addressing climate challenges and social development goals.
