CEOs are Sustainability Change-makers: NBS-SA Report
(3BL Media/Justmeans) – CEOs have the ultimate responsibility to lead, inform and manage the implementation of their company’s strategic goals and business plans. To make a transition to a more sustainable world, CEOs must play a crucial role by integrating ESG factors into corporate decision-making, and commit to structure their governance processes and business practices in line with a vision to improve global sustainability.
To provide insights into decision-making in the C-Suite, the Network for Business Sustainability South Africa (NBS-SA) has released a comprehensive report titled CEO Decision-Making for Sustainability. The report offers an in-depth examination of the key question: Why do some CEOs make the shift towards incorporating sustainability into strategy – and what holds others back?
The report draws valuable inputs from a review of prior work on CEO decision-making and from interviews capturing the practical experiences and insights of 84 CEOs, chairpersons and board members, executive team members, and internal and external change agents on integrating sustainability into strategy.
The report answers critical questions on the factors that impact CEO decision-making for sustainability and key barriers that prevent some of them from prioritizing sustainability. It outlines actions for change agents to support their CEOs, and analyzes the characteristics of effective sustainability change agents.
From their interactions with the CEOs, the researchers found that the CEOs’ professional and personal experiences and connections, the degree to which they are broad scanners of information, and their own personal biases and worldviews shaped their readiness to engage in conversations about sustainability.
CEOs pointed to both the internal and external contexts of the business as key moderators of their decision-making. They mentioned three other factors that, at the end of the day, guided their decision-making. These include: the need to demonstrate performance, the aim to be seen as a good steward of the company, and the desire to leave a personal legacy.
Researchers found that CEOs in companies that were more actively integrating sustainability into their core strategic processes were more likely to describe themselves as broad environmental scanners. What differentiated these leaders was not just that they read widely, but what they read and how they made use of it.
These leaders described how they actively seek out and incorporate resources that address “big issues” and “big opportunities” in the world today and how this knowledge shapes their approach to the running the business. They also pointed to the need to seek out and draw on a range of voices and perspectives.
The researchers also examined what it is that holds some CEOs back from prioritizing sustainability. A sequence of three answers surfaced repeatedly in the discussions with CEOs:
- “I didn’t know enough about environmental and social issues.”
- “I wasn’t able to make a clear link to why this mattered for my business.”
- “I could understand the link, but there were competing priorities.”
The report points out that change agents can support the CEOs and help to catalyze better decision-making around sustainability. They can help them to create strong business cases for sustainability, create opportunities for them to experience sustainability issues first-hand, enable them to learn from influential peers, and leverage the interests of key stakeholders to promote sustainability.
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