CSOs role in helping meet Sustainability Goals and how it’s likely to evolve in the Industry

The recent advent of the Chief Sustainability Officers (CSOs) assuming senior executive positions in organizations signal the significance of sustainability initiatives in the modern corporate world. Given today’s concerns regarding complex sustainability requirements, the CSO is responsible for overseeing and managing the company’s sustainability activities, impacts, and goals. He advocates key measures for sustainability improvement by bringing a broad skill set, leadership experience, business management acumen, and essential public relations expertise.

Commercial giants such as P&G, H&M, and Nike have CSOs in place to drive their sustainability initiatives as a part of their business strategy. The number of companies creating genuinely powerful positions for CSOs is likely to increase significantly in the coming years. Research shows that the year 2003 saw the number of companies with full-time CSOs to be twice more than the year 1995. This doubling trend repeated between 2003 and 2008.

Role of the CSO in different stages of sustainability

The CSO’s responsibility and role shift depend upon the sustainability stages that companies engage in at various development phases:

Compliance

This is the initial phase, where companies indulge in activities related to the maintenance of compliance and regulations. Compliance activities are not typically centralized or strategized and CSO positions are not formed at this stage.

Efficiency

At the next stage, organizations formulate strategies to maintain sustainability and achieve efficiency to cut costs. Some of these measures may be cutting energy, recycling waste, reducing water usage, carbon emissions, and solid waste generation. Many companies hire an official corporate CSO who works with the CEO at this stage. He will be in charge of creating lucrative business initiatives and enhancing the company reputation. This phase lasts the longest in most companies where the CSO drives the sustainability strategy execution.

Innovation

This is the more advanced stage in organizations where the sustainability factor is integrated into core business concepts to transform the company. Sustainability strategies are driven by market conditions to maximize long-term profitability. Sustainability efforts at this stage focus on long-term profitability by addressing the bigger picture involving society, water management, climate change, and so on. In this phase, the entire responsibility of sustainability stays in the hands of the CSO without the CEO’s advice. He must chart out an elaborate sustainability strategy by mapping out the changes to be made and get the organizational staff on board to implement them.

But CSOs also delegate certain responsibilities and decision power to various departments. While the CSO concentrates on his own responsibilities at the Efficiency stage, he delegates decision-making to business units and makes them accountable at the Innovation phase. This phase allows companies to break into new markets and envision new opportunities.

Commitment

Many companies fail to make it to the Innovation stage as they are wary of the risks of ambitious sustainability projects. They only focus on short-term goals such as reducing energy use and saving costs. Here is where the CSO helps as he pushes the organization to raise the stakes and take risks. He pushes the company staff to move ahead and get more ambitious with large-scale sustainability projects.

DOW Chemicals and Nike are examples of companies that made it up to the innovation stage. At DOW, the employees leveraged their scientific know-how to build solar panel components and develop techniques for safer, low-emission cars.

Typical Job Responsibilities of a CSO

The CSO job responsibilities vary according to the industry and the level of sustainability the company aspires for. Given below are the typical activities undertaken by an executive-level CSO to embed sustainability into the organizational culture:

  • Develop a deep understanding of the company and the industry and critical sustainability issues.
  • Manage environment regulations and compliance reporting requirements.
  • Set goals for sustainability.
  • Lead sustainability discussions, drive strategy and engage employees.
  • Mentor and coach other executives.
  • Interact with external stakeholders such as partners, regulators, media, etc. regarding various sustainability projects.
  • Formulate sustainability strategies that can transform the business.

Evolution of the CSO role over the years in Indian companies

Indian companies began to recognize the role of Chief Sustainability Officer from the early 2000s. Initially, the responsibilities of the CSO in India entailed issues related to legal and environmental compliance. But sustainability programs were limited only to the core business area and did not cover the entire supply chain.

The next stage was the birth of the Global Reporting Initiative or GRI and the responsibility of Indian companies to adopt GRI reporting. The CSOs undertook the job of coordination of sustainability reporting.

Over the years, Indian companies began to realize the opportunities that sustainability brought to their businesses making the CSOs a stronger force in organizations. They became strategic thinkers, created frameworks, and guided CEOs to build a sustainability vision for the company. CSOs needed to ensure that all core business functions were integrated with the sustainability factor.

The Future for CSOs

As more and more companies are looking to make their businesses future-ready, they will strive to align their operations with sustainability trends. The CSO’s role will become more strategic, dynamic and add value to the company’s vision. Ultimately, the CSO and the business strategist will blend into one.