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Should Chief Sustainability Officers sit on the company board?

Amongst the conversations and meetings I had last week this question came up in discussion with some experienced folks in the field of CR.

So here’s my take below, on the pros and cons of having a CSO.

Arguments for:

A) Companies having a CSO on the board (note some are currently not, despite the title) can be seen by employees and others, to take sustainability seriously at a very senior level.

B) The CSO can input regularly to strategic business decisions, helping integrate sustainability into every-day business.

C) Other board members will become educated by the CSO on why sustainability is so critical to the business, and take that with them elsewhere, and into their daily work.

Arguments against:

A) It’s just not needed. The CSO, or equivalent (why be a CSO if you are NOT a board level executive? It may devalue C-suite titles in the business) should simply report directly to the CEO and relevant executives. That way, the CEO and other executives have regular access to direct thinking, challenges, and information, and can lead more effectively.

B) The CSO becomes the focal point of sustainability thinking. This is unhelpful A) if they leave and B) because other board directors will feel less pressure to know about sustainability issues and be less able to spot risks and opportunities.

C) It just sounds a bit too woolly as a really senior business job title, today. Anyone with that title could be easily subject to internal and external ridicule, particularly if their role and responsibilities are not very clearly understood.

On balance, I’d suggest companies should not have a CSO job title in the business.

If sustainability is integrated into strategy, business unit heads should report to relevant board directors, senior execs, and the CEO on progress, not just to one person.

Head, or director of sustainability will do the job just fine. But they should have a reporting line and regular access to the CEO, AND other board directors / senior managers (if in the US, where of course senior managers aside from the CEO do not sit on boards)

Rather than have a CSO, why not instead have distinct and bespoke roles for board members / senior managers in the business, in integrating sustainability beyond their business line responsibilities?

So have the CFO spend time on collaborative groups that work on putting numbers against sustainability issues.

Have the head of supply chain / procurement take part in industry groups that focus on how to teach suppliers to run smarter businesses and thereby improve social and environmental performance.

Have your chief legal officer spend a week a year on cutting-edge anti-corruption or fraud prevention work, looking at causes as well as reactive solutions.

I spend a few days month with very senior execs, on average, I would guess.

None of them have ever asked me if they should create a CSO position in their business

If asked, on consideration, my response would be this:

“No, instead empower your sustainability director to speak to your board/senior managers regularly.

Then support him or her in giving other executives and non-executives direct tasks, next to their standard sustainability targets/expectations.

Finally, have those other executives and non-executives, report back on progress related to these tasks, and review them annually. This will drive both the embedding of sustainability, and innovation in the business”.

I’d be interested to hear what readers think about this.

2 Comments

  1. Interesting blog again Toby — thanks; the 'not-on-board' case you make is very persuasive. There's a lot of interesting comparative insights to be drawn from strategies for 'mainstreaming' cross-cutting issues like gender or human rights in large donor agencies or multilaterals – Jo Ford.

  2. Publicly traded companies typically spend 1 – 2 percent of gross revenues on managing the financial systems. The amount companies spend on sustainability initiatives is a small fraction of what companies spend on tracking and managing financial market issues. Compare the budget of the CFO to the CSO and one can quickly see the imbalance. Until companies invest a similar amount on sustainability — e.g, 2% for sustainability — it is shortsighted to think a CEO can carry the ball. A sustainability person on the Board could help fill the gap in a way that a CEO, with the competing priorities cannot. The answer should be both — a CEO that is truly committed to sustainability excellence AND a Board slot for a CSO. We cannot settle for the status quo.

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