In part 2 of the series, I’m going to talk about the Board and some of the challenges and opportunities this senior group present to sustainability folk. The make-up of the board is of course something that will come into your governance metrics these days, with board diversity a hot topic, but for this article I’m going to focus more on the importance of having the board engaged with sustainability.
Often senior management engagement and knowledge in sustainability is overlooked, particularly with the board itself. I sometimes start work with clients by interviewing their board and senior executives individually. I find that way there is more chance of teasing out how much they really know and are comfortable with when it comes to the myriad of topics under the sustainability banner. Talking to them individually also means they can be honest without admitting in front of their peers where they are not as confident as they think they should be, something that not all board members are comfortable with. The results are often surprising, not least the contrast between what they do and value outside of work, and the way they approach topics in their business.
One of the recurrent themes I see is that Board members are by their very nature senior folk who have been around for a long time in business. But back when they were young, nobody was really talking about sustainability, certainly not in a business context, so they haven’t grown up with the topic like they have with all the financial elements of running a business which haven’t really changed beyond a few new ratios that might be flavour of the month. The same is true for technology too. As a result, their knowledge is sometimes not based on a particularly firm foundation that they have built up over a number of years. They may not have a real in depth understanding of an issue, but equally they may also not have caught up with how issues are important to various stakeholders, whether that is customers, suppliers, investors, or their own employees. I’m overstating this to make the point, but I have lost count of the number of board members who have admitted to me that they know they don’t know as much as they should on sustainability and need to catch up.
In particular they may not have appreciated how the sustainability agenda is part of the overall business strategy and day to day operations of the business. When you can explore this with them and connect why it matters to the company’s various stakeholders and the risks and opportunities for the business, it can be a real eyeopener and can lead to some stimulating debate.
Sadly, there are still many company boards who have people on them that see sustainability reporting and actions as an inconvenience at best or an irrelevance at worst. Without this changing it is very difficult for a sustainability manager to drive things forward. With a more knowledgeable and engaged board things can really move forward very rapidly.
It’s not surprising that many board members are not fully up to speed on what is a very wide-ranging topic, and which is just one of the many aspects of a business that they need to be aware of. Non-execs in particular will often be on the boards of more than one company too. This of course can be a benefit through sharing knowledge and experiences across businesses, and often boards now have a non-exec that takes the lead on ESG topics and may even be on a sustainability council or committee. Sustainability managers can often find a way onto the board agenda through such contacts.
But often boards need an external voice to help them, particularly if they feel exposed and unsure of their knowledge. This is where a formal board engagement programme can help. It can start with the board 1:1s with a feedback session with the whole board afterwards or it might be an annual programme of knowledge building without this initial session. Either way, CEN can help.
Whether you choose to use external help or not, getting to know your board is important for anyone tasked with leading sustainability in an organisation, and getting them to know the topic is vital to the success of any sustainability programme.
About the Author
Chris is a senior strategic leader with over 25 years’ commercial experience including sales, marketing, strategic planning and major business change initiatives at AkzoNobel and ICI. He has a wide knowledge of sustainability and how to integrate this into business having held senior sustainability roles at AkzoNobel for 12 years, including as Global Sustainability Director Decorative Paints and AkzoNobel Planet Possible Programme Manager. Chris is now an independent sustainability consultant and a pension trustee director.
Contact us
CEN helps businesses maximise their sustainability potential, performance, and ESG disclosure.
For more information, please get in contact and our team would be happy to assist.
Jasper Crone, Director
Roger Johnston, Director
For more information about our Sustainability Consultancy, Investor Relations, or CEN Data services and expertise, please click on Services above or go to www.cengroupholdings.com.
コメント