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  • Writer's pictureMaija Āboliņa-Tomsone

Driving ESG Transformation: Why Companies Need a Chief Sustainability Officer (CSO)

Why should companies consider having a Chief Sustainability Officer (CSO)? What benefits can a CSO bring to a company? And How can a CSO drive ESG transformation and bring more value to a business?

As the world becomes more environmentally conscious, companies are under increasing pressure to adopt sustainable business practices. The World Economic Forum reports that 76% of people expect companies, not governments, to lead the way on climate change. Additionally, 46% of people believe that top talent would only want to work for companies with sustainable business practices. The role of a Chief Sustainability Officer (CSO) is an opportunity for companies to address these environmental, social, and governance (ESG) issues.

According to World Economic Forum, 76% of people expect companies, not governments, to lead the way on climate change.

Here are some reasons why a company should consider hiring a CSO:

  • Dedicated Sustainability Strategies

With a CSO on board, companies will have an employee dedicated to developing and executing strategies that address energy use, resource conservation, recycling, pollution reduction, and waste elimination. Essentially, a CSO is a company’s dedicated employee to "go green."

  • Determine the Best Route

A well-trained, dedicated CSO will be able to assess viable options for sustainability initiatives and determine the best route. No time or money needs to be wasted on efforts that fall short.

  • Monitor and Evaluate Sustainability Program

Once implemented, the CSO can monitor and evaluate the effectiveness of the company's sustainability programs. Only the best proposals will be approved, and the CSO can then work on sustainability reports, grant applications, presentations, and marketing campaigns.

  • Leadership in Sustainability Programs

Your CSO will be at the forefront of your company’s sustainability programs, providing leadership to accomplish objectives and ensuring compliance with local, state, federal, and environmental laws and regulations.

  • Meeting Net Zero Agenda

Companies need a CSO to ensure they are doing their part to meet the "net zero" agenda, which refers to zero impact, zero emissions, and zero carbon footprint.

The point at which companies should introduce the CSO role depends on several factors, such as whether stakeholders care about ESG, the role of ESG in the company's strategy, and whether the CSO role would be complementary. For instance, if the company faces complex ESG demands, and the existing C-suite positions are not fulfilling its ESG needs, it may be worth considering adding a CSO to the C-suite.

The key role of a CSO is to transform the company to become more ESG-oriented. They drive the sustainability strategy of an organization, championing and monitoring its efforts, distinguishing them from ESG managers of lower ranks. A CSO coordinates ESG efforts in the organization, both horizontally between the ESG pillars and functions, and vertically across hierarchical levels up to the CEO.

CSOs must have several skills to perform their role effectively, including a good understanding of the business, being charismatic leaders, strategic thinkers, data literate, good communicators, ambitious, and have a healthy risk appetite.

According to an article published by Harvard Business Review titled "The 8 Responsibilities of Chief Sustainability Officers", there are eight key responsibilities that a CSO should focus on to drive sustainable practices within an organization.

Let's dive into these responsibilities and their significance:

  1. Develop a Sustainability Strategy

The first responsibility of a CSO is to develop a sustainability strategy for their organization. This strategy should outline the company's goals and objectives related to sustainability, and how they plan to achieve them. By developing a clear strategy, a CSO can ensure that their company is taking a proactive approach to sustainability rather than just reacting to external pressures.

2. Integrate Sustainability into Business Operations

Sustainability should be integrated into all aspects of a company's operations. A CSO should work closely with different departments to ensure that sustainability is considered in every decision. For example, they may work with the procurement team to source more sustainable materials or work with the marketing team to develop messaging around the company's sustainability efforts.

3. Drive Innovation for Sustainability

CSOs should drive innovation to develop new and more sustainable ways of doing business. This includes researching and developing new products, processes, and technologies that reduce the company's environmental impact.

4. Monitor and Report on Sustainability Performance

Measuring and reporting on sustainability performance is crucial to ensure that a company is making progress towards their sustainability goals. A CSO should develop key performance indicators (KPIs) and regularly report on them to the company's leadership team and stakeholders.

5. Engage with Stakeholders

Stakeholder engagement is essential for a company's sustainability efforts. A CSO should work closely with stakeholders, including customers, suppliers, and local communities, to understand their sustainability concerns and develop solutions that address them.

6. Manage Environmental and Social Risks

A CSO should identify and manage environmental and social risks that could impact the company's sustainability efforts. This includes assessing and mitigating risks related to climate change, biodiversity, human rights, and other sustainability issues.

7. Ensure Compliance with Sustainability Regulations

There are numerous sustainability regulations that companies need to comply with, such as emissions regulations and waste disposal regulations. A CSO should ensure that their company is compliant with these regulations and take steps to exceed them where possible.

8. Drive Culture Change

Finally, a CSO should work to drive culture change within their organization to embed sustainability into the company's DNA. This involves educating employees about the importance of sustainability and creating a culture that values sustainability.

In conclusion, CSOs play a vital role in driving the sustainability agenda for companies. They are responsible for coordinating and driving ESG efforts and strategies, ensuring compliance with laws and regulations, and championing the company's sustainability initiatives. Companies should consider introducing the CSO role to ensure that they remain relevant in the changing environmental landscape.


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