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Corporate Sustainability Becomes a Team Sport

Chief Sustainability Officers have historically been technical experts focused on helping companies unravel their carbon footprint. Today’s CSOs are business transformation specialists who support companies in their sustainability efforts and are supported by a team of experts.

With the recent spate of net-zero corporate promises, a plethora of sustainability regulations set to come into force over the next few months, and increased scrutiny from customers, investors and other stakeholders, the role and responsibilities of the CSO have evolved to… to live up to the moment. As a result, most CSOs are now tasked with helping the company figure out how to transform to meet sustainability goals profitably despite a lack of leaders with green experience.

“When we see companies trying to integrate sustainability, we see that the role opens up more to strategic people, people who are transformers, change agents, disruptors, as opposed to maybe the subject matter experts who previously led it said Rachael De Renzy Channer, Global Head of Sustainability at Executive Recruiter Egon Zehnder.

The recent anti-ESG movement doesn’t appear to be slowing down CSO hiring — a record number of US companies hired their first CSO last year, according to a survey by recruitment group Weinreb. Additionally, all but one of the CSOs of the nearly 100 public U.S. companies that responded to the Weinreb survey said they work with the board of directors, and about three-quarters of those surveyed sit on the executive team, rather than less than half in 2011.

“The world has moved from asking about sustainability commitments and declarations to how we will deliver on them,” said Judith Wiese, chief people and sustainability officer at German industrial technology company Siemens Inc

. Ms. Wiese said sustainability is a cross-cutting issue with the CSO acting as conductor, literally orchestrating it across the organization.

Still, CSOs often have limited powers, requiring them to be the ultimate integrators and influencers to engage so many different stakeholders within their companies, said Tara Hemmer, chief sustainability officer at waste and recycling company Waste Management inc

“Getting people to do things that might make them uncomfortable without actually being in that reporting chain is very nuanced,” she said.

The CSOs interviewed by Weinreb said the most important skills they need are strategy and vision, the ability to make an impact without authority, and the ability to translate sustainability issues into a language that resonates with others in the organization.

In addition to the internal complexities, the sustainability landscape is changing rapidly. Technologies are developed and scaled as stakeholder expectations evolve. ESG definitions and standards are also changing, including mandatory climate reporting and greenwashing crackdowns that increase the likelihood of getting things wrong.

“It’s not a static role. You cannot be happy if you meet your 2023 goals because the social demands or the demands of investors are moving and they are moving more and more over time,” said Agustín Delgado Martín, Chief Innovation and Sustainability Officer at global power- and network company Iberdrola SA

. “You have to start thinking about the requirements in 2022, which will be a hot topic in 2025.”

Judith Wiese, Chief People and Sustainability Officer at Siemens.


Photo:

Siemens AG

To keep up with all of this, many sustainability leaders are building a team to support them, often made up of deep technical experts in the areas most relevant to their business. According to Weinreb’s survey, the number of employees reporting directly to the CSO doubled from four to eight between 2011 and 2023.

dow inc

The veteran Andre Argenton was appointed CSO of the industrial materials company about a year ago. His team includes experts in technology, industrial processes, financial markets, sustainability frameworks and reporting standards. “The team has an interesting mix and its diversity is its strength,” said Mr. Argenton.

Susan Uthayakumar joined Prologis inc

– a global logistics real estate developer – was appointed Chief Energy and Sustainability Officer a year ago after a long career at Schneider Electric SE.

She has assembled a team of experts with expertise in grids, power generation, green building and mobility projects, ESG reporting, scope 3 emissions measurement and supply chain improvement. Ms. Uthayakumar chose to hire experienced staff to quickly expand her team’s capabilities.

However, recruiting experienced sustainability staff remains a challenge. “Competition for outside talent is tough,” said Ms. Hemmer of Waste Management. In addition to hiring external staff, Ms. Hemmer has established a sustainability rotation program to train her team across the board and has also brought in some other senior executives from within the company. Mr. Argenton at Dow has also drawn on an extensive network of experts throughout the company.

The changing skillset for CSOs can help companies looking to hire someone. Marie Cloherty, Executive Director of Sustainable Business at environmentally conscious recruiter Acre, suggests looking for someone within the company who has successfully led transformative change. “You’re a cheerleader, a champion. You give them any theme and they run with it. It’s actually these people who are very well placed to take on the sustainability agenda and then you can hire the technical expertise,” she said.

Agustin Delgado Martin, Chief Innovation and Sustainability Officer at Iberdrola.


Photo:

Iberdrola SA

There are also a few experienced CSOs who have already guided their company through a low-carbon transition, although those with such backgrounds are in high demand. “They want to make sure they can make a real difference everywhere they go, and that’s why they’re very selective about who they talk to,” said Sarah Galloway, co-head of global sustainability practice at recruiter Russell Reynolds Associates.

An example of a seasoned CSO is Erin Meezan, who led the decarbonization of flooring supplier Interface inc

over their 18 years with the company. Last year she became CSO at Jones Lang LaSalle inc,

a global real estate and investment services company.

“There’s a lot of people of my generation — the first generation of CSOs in places like Salesforce and Levi’s and other places — who’ve recently dropped out because they’ve said I’ve built a program, it’s embedded, it’s been very successful. How do I go somewhere where I can make a bigger impact this decade?” said Ms. Meezan.

Write to Rochelle Toplensky at [email protected]

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