Leadership Matters

Perspectives on the key issues impacting senior leaders and their organizations
April 22, 2024

How CEOs can mobilize their entire organization to fulfill sustainability’s promise

Earth Month is a time when many people reflect on how they can personally make a difference in the fight against climate change and biodiversity loss. CEOs are in a unique position to help connect the dots for how every employee can play a role. They shouldn’t let this opportunity go to waste.

Sustainability efforts have run into headwinds. In the past year, prolonged fears of inflation and economic uncertainty have led to concern that companies may reassess their sustainability initiatives. The broader debate around ESG efforts, particularly in the United States, has become politicized. Impending reporting requirements in both the EU and United States threaten to pull resources away from sustainability initiatives. And the global stocktake released at COP 28 in November 2023 showed most nations were falling short of their decarbonization targets.

These developments have made the path forward more difficult, but they should also remind executives why they embraced sustainability in the first place. A principal motivator for business leaders was the recognition that sustainability made good business sense. When integrated into strategic planning, sustainability can have a direct impact on the bottom line (in the form of lower operating costs and greater resilience, for example) as well as indirect benefits on a company’s brand and reputation.

Yet recent research conducted by Spencer Stuart and Kite Insights revealed a potentially serious obstacle to fulfilling sustainability’s promise: a chasm between the lofty aspirations of corporate sustainability efforts and clear direction for how employees themselves can contribute to the cause. Closing this gap is critical. Meeting ambitious sustainability goals demands organizations mobilize every worker, just as the entire workforce has a role in providing excellent customer service or fending off cyber threats.

Rallying the organization around this shared responsibility requires CEOs to set the proper tone on sustainability from the top and work through their leadership team to align and energize employees. Three actions can help.

1. Elevate sustainability as a strategic priority and provide consistent visibility

Chief sustainability officers (CSOs) may be the tip of the spear on sustainability, but success requires engagement by other top leaders. CEOs have a vital role in connecting sustainability directly to the organization’s strategy: our research found 93 percent of CSOs view the CEO as the most important role/function for an organization to achieve its sustainability goals. That means CEOs must be prepared to wield their influence — for instance, by highlighting sustainability in strategy meetings with the top team and making progress against sustainability targets a part of performance reviews.

2. Champion the expansion of organizational capabilities in sustainability

It’s difficult to embed a sustainability culture across an organization. While employees are often interested in making progress toward sustainability goals in their daily jobs, that doesn’t mean they have the requisite knowledge and skills to do so. The good news is our survey found nearly two-thirds of CSOs are currently pursuing efforts to educate workers about sustainability and the skills they need to support its strategy. CEOs can promote the importance of this enterprise-wide commitment and recognize evangelists who are leading the charge at all levels of the organization.

3. Team up with the CSO to engage business unit leaders

Sustainability’s potential to create value varies significantly by function. That means CEOs and CSOs need to be able to tailor their conversations. Our survey revealed some functions, such as marketing and recruiting, have already seen the value of sustainability efforts in reputation building and talent attraction. Others, including finance and procurement, are more likely to view sustainability as a risk management lever. CEOs able to articulate how sustainability directly supports the goals of individual functions across different time horizons will be able to better mobilize their colleagues. This process often involves addressing misconceptions or gaps in information, so the CEO and CSO should ensure they work in tandem.

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Operating with the planetary boundaries and making progress on climate change, biodiversity loss and other threats to earth will take a consistent, coordinated effort. Similarly, CEOs must be prepared to work closely with their CSO and leadership team to connect employees to the organization’s sustainability goals. Forging this connection will not just ensure that goals are met, but that the promise of competitive advantage becomes a reality for those organizations committed to a truly sustainable future.