Leadership in Corporate Sustainability: Survey and Report 2018

22 February 2019 - Many organisations are rising to the challenge of creating a sustainable business, but there appears to be a wide diversity in approaches to sustainability. There is a chance that different approaches will lead to inconsistency of delivery – a lack of consistent understanding and measurement could create a false impression of success, leading to underestimation of the impact of sustainability.

The purpose of this study

Mazars, Board Agenda and INSEAD Corporate Governance Centre have partnered to ask business leaders about their company’s sustainability outlook in order to understand what exactly is motivating board members to keep sustainability on their agenda, and how they are demonstrating their knowledge of sustainability issues while translating them into corporate strategy and action.

Sustainability is very high on the boardroom agenda, second only to financial performance. It is not enough for boards to just be aware of and express a commitment to sustainability, they now need to demonstrate that they are willing to act positively to ensure their words are matched with actions. Boards should be looking for sustainability expertise and mindset when appointing new board members; and explicitly integrating sustainability into board committees and board member duties.

Findings from the survey include:

  • 70% say their company makes a positive contribution to society, 29% are aiming to be a market leader in sustainability and 10% admit sustainability does not figure in how they position themselves
  • 73% believe that ignoring sustainability will affect their company’s ability to create long-term value
  • 53% say their board sees a solid business case for sustainability, while 57% say they aim to meet their obligations. Only 24% cite growing pressure from customers
  • 35% fully agree that sustainability expertise or a sustainability mindset are explicit selection criteria in the appointment of board members

The results of the survey demonstrate that boards have sustainability on their minds, however they need to make sure they have the infrastructure in place to manage their sustainable performance effectively. A gap seems to exist between the extent to which boards recognise that sustainability is a critical business issue and their effectiveness in measuring and managing it.

There is a degree of confidence that companies are addressing sustainability issues, but equally, there is a lack of consistency over what and how data is gathered and analysed, and how that is then translated into action and responsibility. They need to be able to measure progress on their sustainability journey, so that they can make informed decisions.

Key questions for boards

1.

What is the board-level understanding of sustainability?

2.

What is the board’s attitude towards sustainability? Is it part of market positioning, a means in itself or part of the organisation’s wider purpose?

3.

What weight is given to sustainability compared with other corporate issues such as financial reporting, risk management, productivity and cultural change?

4.

Where does responsibility for sustainability lie at board level?

5.

How is oversight of sustainability managed?

6.

How is sustainability integrated into wider risk-management processes?

7.

How is the organisation’s sustainability agenda communicated to stakeholders?

8.

Is sustainability considered as part of any investment decision?

9.

Where are the greatest sustainability risks and opportunities?

10.

Does sustainability form part of a recruitment, retention and reward strategy?

Want to know more?

Would you like to know more about the results of this survey. Please do not hesitate to contact us.

Want to know more?