This August, CECP hosted its fourth ESG and Sustainable Business Peer Connect– a quarterly opportunity for senior leaders to connect with peers and experts on trending ESG topics. The event discussed how the scope of responsibilities for Chief Sustainability Officers (CSO) have dramatically shifted over recent years, growing to become integral cross-organizational partners in strategy setting, internal and external communications, and investor relations. Jennifer Motles, CSO of Philip Morris International, and Professor Robert G. Eccles of Said Business School, University of Oxford and Capital Partners, joined the conversation to explore the evolving role of CSOs.
During this hour-long, closed-door session, participants considered the complexity companies are facing with business model and energy transitions, which create many economic, environmental, social, and even political tradeoffs. These tradeoffs seem to be more extreme today than just a few years ago – how do companies balance sustainability with affordability, while meeting (sometimes conflicting) stakeholder expectations?
CSOs are finding themselves caught in the middle of the demand to create long-term positive environmental and social impact, but not at the expense of business performance. Additionally, some CSOs are also grappling with how to manage through ESG backlash in places where sustainable investing is being challenged. Moreover, those who participated in CECP’s recent ESG and Sustainable Business Peer Connect reported experiencing investors getting more involved and requesting information regarding their climate targets and implementation strategies from the last 2-3 years. One CSO spends a lot of time talking with investors about their plans. Most companies are finding that investor and stakeholder interest is still supportive of ESG regardless of politics.
Despite this backlash, executive teams remain committed to pushing forward with their environmental and social agendas. They are leaning on their sustainability and communications teams to help frame their message across without using the terms “ESG” or “sustainability”.
To grapple with these various demands, some companies rely on building effective relationships across the organization and implementing sustainability governance structures. A few examples include:
- Have partners in finance and investor relations to ensure alignment on investor communications.
- Spend time with proxy voting and portfolio managers to understand top-of-mind issues for investors.
- Ensure the board is well informed about the sustainability strategy.
- Form a sustainability/ESG committee that brings together other business units and functional leaders.
Corporate social responsibility and sustainability leaders at CECP-affiliated companies have complimentary access to these closed-door, off-the-record conversations. Join us for our next ESG and Sustainable Business Peer Connect on October 10, 2023.