Question for Corporate Leaders: Is Your Company’s Sustainability Journey Based on Key Strategies? Is There Clear Alignment of Foundational Strategies With Sustainability?

G&A's Sustainability Highlights (02.15.2019)
Feb 19, 2019 10:00 AM ET
Newsletter

HBR Authors Share Some Research Findings Of Importance to Corporate Leaders and Asset Managers...

Strategy – the familiar word comes down to us over the eons from the language of ancient Greece. The roots of the original word (translated to “stratagem”) mean “the work of the generals, or generalship” which is to clearly say:  to lead from the front..or the top! 

In 2019, “strategy” and “sustainability” should be clearly linked, right?  In the corporate sector, setting strategies is at the heart of the work of the men and women at the top, in the board room and in the C-suite.  So what does that mean to us in terms of the intensive focus today on corporate sustainability and ESG performance? (And, the impacts positive and negative in the capital markets?)

The corporate enterprise that is seeking to excel among its peers, and clearly demonstrates leadership in sustainability matters (that encompasses a broadening range of ESG issues today) surely has the leaders at the top crafting, innovating and sharpening the leadership strategy…and driving the foundational elements down into the depth and breadth of the enterprise.  Typically, universal understanding helps to drive competitive advantage and creates a moat more difficult for peers to cross.

And so in this context, what about the “corporate sustainability laggards”?  Often in our ongoing conversations with a wide range of corporate managers – and with investment managers evaluating corporate ESG performance – the companies not yet well along in the journey or perhaps not even started on the journey, lack of sustainability strategy sends a signal of “silence” from the top ranks.  What it says to stakeholders:  ESG and strategy = not connected yet, there is a lack of quality in our management and board.  Don’t look to our firm for signals of sustainability leadership.

We find that most large-caps “get it” and it is the resource-challenged small-cap and mid-cap firms that are not yet started or not far into the sustainability journey. 

The topic of corporate sustainability strategy gets a good overview in the pages of the Harvard Business Review by the outstanding ESG / sustainability experts, George Serafeim and Ioannis Ioannou.  Their post is based on their new 45-page paper (“Corporate Sustainability: A Strategy?”) and their co-authored HBR management brief is our Top Story for you. 

This is just the introduction of G&A's Sustainability Highlights newsletter this week. Click here to view full issue.