Sustainability managers have always been technical experts whose goal is to help companies determine their carbon footprint. Today's CSOs are business transformation professionals who support companies in their sustainability efforts with the support of a panel of experts.
With a recent flurry of corporate zero-sell commitments, a plethora of sustainability rules to come in the coming months, and increased attention from clients, investors, and other stakeholders, the roles and responsibilities of CSOs have evolved to oversee response times. As a result, most CSOs now face the challenge of helping businesses decide how to transform themselves to achieve the Sustainable Development Goals profitably, despite the absence of environmentally savvy leaders.
“When we see how companies try to implement sustainability, we see that this role opens up to more strategic people, people who are transforming, agents of change, disruptors, as opposed to the domain experts who used to lead it,” said Rachel . Renzi Channer, Head of Sustainability at Executive Recruiter Egon Zehnder.
The recent move against ESG does not appear to be slowing down CSO hiring. A record number of U.S. companies hired their first CSOs last year, according to a survey by recruiting group Weinreb. In addition, all but one of the nearly 100 public U.S. companies surveyed by Weinreb said they have a board of directors, and about three-quarters of those surveyed are on a management team, compared with less than half in 2011.
“The world has moved from sustainability commitments and declarations to how we implement them,” says Judith Wiese, human resources and sustainability manager at Siemens AG , a German industrial technology company. Ms. Wise said that the issue of sustainability is cross-cutting, and as a director, CSOs literally lead it throughout the company.
But CSOs often have limited authority, so they need to be key integrators and influencers to get as many stakeholders as possible into their companies,” says Tara Hemmer of Waste Management Inc. , Sustainability Director Waste Village and Recycling. It is inconvenient not to be in this chain of reports, there are so many nuances,” he said.
The CSOs Weinreb spoke with said the most important skills they need are strategy and vision, the ability to work without being affected by reputation, and the ability to translate sustainability issues that resonate with others around the world.
In addition to internal complexities, the sustainable development landscape is rapidly changing. Technology evolves and scales as stakeholder expectations change. ESG definitions and standards are also evolving, including mandatory weather reporting and anti-greenwashing, which increases the potential for errors.
“This is not a static role. You cannot be happy when you reach your goals for 2023 because the demands of society or the demands of investors change and change more and more over time,” says Agustín Delgado Martin, director of Global Power and Network. Innovation and Sustainability by Empresa Iberdrola SA "In 2022, you need to think about what surveys will be relevant in 2025."
To keep up with all of this, many sustainability leaders are building a support team, often made up of deep technical experts in the areas most important to their business. According to Weinreb's research, between 2011 and 2023, the number of employees reporting directly to CSOs will double from four to eight.
Veteran Dow Inc. André Argenton was appointed CEO of an industrial materials company about a year ago. The team includes experts in technology, industrial processes, financial markets, sustainability systems and information standards. "The team has an interesting line-up and its strength is in its heterogeneity," said Argenton.
Susan Uthayakumar joins Prologis Inc. , a global logistics real estate developer, a year ago as Director of Energy and Sustainability after a long career at Schneider Electric SE . He has built a team that includes people with expertise in grid construction, power generation, environmental and mobility projects, ESG reporting, Tier 3 emissions measurement and supply chain improvement. Ms. Uthayakumar decided to hire experienced staff to quickly improve the skills of her team.
However, the recruitment of employees with sustainability experience remains a challenge. “Competition for outside talent is fierce,” says Waste Management's Ms. Hemer. In addition to external staff, Ms. Hemer developed a sustainability rotation program to train her team and hired several other executives into the company. At Dow, Mr. Argenton has also deployed an extensive network of industry experts throughout the company.
Developing CSO skills can help companies hire them. Marie Cloherty, managing director of sustainability at recruiting firm Acre, suggests finding someone in the company who has successfully led transformational change. “He is a cheerleader, a champion. You give them any topic and they follow it. In fact, these are the people who are very well placed to take on the sustainability agenda and then you can hire technical people,” he said.
There are also experienced CSOs who have already transitioned their businesses to a low-carbon regime, although those with such experience are in high demand. “They want to make sure they're making a real difference everywhere, so they're very selective about who they talk to,” said Sarah Galloway, co-head of global sustainability at recruiting firm Russell Reynolds Associates. .
An example of an experienced CSO is Erin Mezan, who led the decarburization process for Interface Inc., a flooring supplier, during her 18 years with the company. Last year, he became a CSO at Jones Lang LaSalle Inc., an international real estate and investment services firm.
“There are a lot of people from my generation, those first generation CSOs in places like Salesforce, Levi's and other places that have jumped in recently because they said: I created the program, it is integrated, it is very successful, how can I go there, where can I make a bigger impact this decade?” Mrs Mezan says.
Email Rochelle Toplensky at rochelle.toplensky@wsj.com
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