Inclusive Growth

The Private Sector Is Becoming a Major Catalyst for Sustainability

The Private Sector Is Becoming a Major Catalyst for Sustainability

August 22, 2018

Mastercard is committed to being a force for good in the world and to doing well by doing good.  As a core component of our strategy, we’re conducting business in an open and transparent way, advancing inclusive growth, building an inspired workforce and being good stewards of the environment to create a sustainable future for Mastercard and the world around us.

Sarah Glaswand, senior content specialist at the Mastercard Center for Inclusive Growth, talked with Kristina Kloberdanz, SVP, chief sustainability officer at Mastercard, about how the company incorporates sustainability into its vision and the findings of its latest report.

Sarah Glaswand: What does sustainability mean to Mastercard?

Kristina Kloberdanz: Mastercard’s commitment to sustainability grew out of a question that the board of directors asked at our IPO in 2006. And that question was, “How can Mastercard serve as a force for good?” A donation of 10 percent of the company’s stock was used to create the independent, private Mastercard Foundation. Its mission is to advance financial inclusion and education to enable economically disadvantaged young people in developing countries to improve their lives. And because of Mastercard’s financial performance, the foundation has grown to more than $20 billion making it one of the largest foundations in the world. In 2017, the Foundation received $100 million in stock dividends to support its ongoing efforts.

Mastercard is serving customers in more than 210 countries and territories and as we’ve grown, we’ve learned that sustainability is key to our success. We look at sustainability in the frame of environment, social and government (ESG). These initiatives are tied to our performance as a business.

When we think of ESG, we focus on four main areas: inclusive growth, inspired workforce, environmental stewardship, and ethical and responsible standards. For inclusive growth, we look at promoting growth across all segments of society, which contributes to stability and shared prosperity and thus, drives our growth as a payments company. For inspired workforce, we ensure that our workforce is inspired by our sense of purpose, is as diverse as our customers and includes the perspectives that diversity brings. That drives our success. For environmental stewardship, limiting the impact of climate change is as essential for our future at Mastercard as it is for the world. And finally, when we look at our business itself, by putting ethics, data privacy and security first, it helps us remain a welcome partner around the world.

Glaswand: What does the phrase “Doing well by doing good” mean at Mastercard?

Kloberdanz: Mastercard’s vision as a company is a world beyond cash: a safer world with less corruption and more inclusion, where everyone can contribute to the global digital economy and where the benefits of that economy are broadly shared. That’s what we think of as a healthy economy and everyone thrives in a healthy economy, including Mastercard. It’s a core component of our business strategy. It’s based on the idea that we do well by doing good. Being both a force for good and a purpose-driven business is part of what helps us do well as a company. It helps us attract top talent, grow our customer base, serve as a problem-solving partner to governments and create brand affinity for consumers and businesses globally. But, sustainability is an ongoing journey. We’ll always work to deliver long-term change and inclusive growth. And that is what we mean by “doing well by doing good.”

Glaswand: One of the four main sustainability areas in Mastercard’s recently released 2017 sustainability report focuses on inclusive growth. What are some of the key findings in this area?

Kloberdanz: Our sustainability report features our efforts to build a sustainable and inclusive future, and I’m proud and excited to share some of the highlights.

For inclusive growth, we talk about our progress toward our commitment to reach at least 500 million people previously excluded from financial services by 2020, and to bring 40 million micro and small merchants into the formal economy by 2021. Today we have reached an estimated 330 million people and 7.6 million micro and small businesses through initiatives in over 60 countries.

We envision a world in which people are on the move — on a path of shared prosperity among all segments of society. This is inclusive growth. The Mastercard Center for Inclusive Growth is pioneering new approaches to philanthropy, including data philanthropy, which is the responsible use of anonymized and aggregated data to support researchers and institutions working for social good.

Additionally, this year, we committed $500 million in funding over five years to Mastercard’s Center for Inclusive Growth Fund, a new 501(c)(3) that will support efforts to stimulate inclusive growth. And, we’ve already contributed the initial $100 million.

Glaswand: What are Mastercard’s plans to be a driver of strategic growth going forward?

Kloberdanz: The future is really exciting for sustainability. It’s come a long way from the idea of corporate social responsibility (CSR). After a while, companies started to drop the ‘S’ and it was referred to as corporate responsibility, which is more about disclosure and transparency. Then, the idea of shared value came into play. And now, there’s also the idea of thinking of sustainability as a driver for strategic growth.

Sustainability now has the focus of investors, clients, employees and prospective employees, governments and communities. Internally, sustainability has visibility and commitment at the highest level of the company: the board of directors, the CEO and the senior management committee. What once used to be “nice to do” is now critical to business success. What once operated in silos is now integrated and has influence across the business, which means we have an opportunity and an obligation for real impact. Our 14,000 Mastercard employees are our greatest brand ambassadors. By engaging our employees in our sustainability journey, it not only helps Mastercard achieve our goals, but also taps into their personal passions in programs such as Start Something Priceless.

I’m incredibly passionate about the power the private sector has in being able to do good in this world. To be a catalyst is what keeps me wanting to do more and to push our limits for social impact. The private sector can help address today’s world issues because it has the ability to access resources and move at a faster pace. Trust will continue to be a focus and companies and leaders will be expected to do more.

We are going to start to see more private-private partnerships. This work is bigger than any one company and when we can apply the assets of our companies together, we can get true scale. These partnerships will take on new forms – it may be a commercial engagement through Mastercard for one partner and a philanthropic initiative through the Center for Inclusive Growth for another. We’re going to see more of this and that’s going to enable us to do so much more good.

Using our network, capital, infrastructure, technology, innovations and our ability to scale to drive sustainability-conscious solutions is going to be our focus going forward, whether it’s digitizing payroll for factory workers, energy inclusion or digital lending for small and micro business owners. When we do this, we create a sustainable system where everyone benefits.

With Mastercard’s new Center for Inclusive Growth Fund, it’s going to be exciting to take things to new historic heights. We didn’t see this a year ago, and that’s what makes it exciting going forward – the unknown potential ahead of us.

Check out the full 2017 Corporate Sustainability Report here.