Gaining leadership buy-in for sustainability
Visible commitment, responsibility and accountability from senior management is critical for achieving greater operational environmental sustainability. Real positive change requires integration of environmental sustainability at the highest level of any company, within its strategic direction, operational decisions, and resource allocations. Securing leadership buy-in is therefore essential for sustainability success.
According to a 2010 UN Global Compact-Accenture study, 93% of CEOs see sustainability as important to their company’s future success, and 96% agreed that sustainability should be integrated holistically throughout operations and strategy [1]. And yet, this isn’t translating into direct action in the way that we might hope.
According to an EcoAct study, while 81% of FTSE 100 companies have an emissions reduction strategy, 85% of these were not sufficient to limit global warming to safe levels. Further, only 8% of FTSE 100 companies were maintaining a carbon neutral status, and attaining neutrality was only formally targeted by a further 10% [2]. Evidence also suggests that only 36% of executives indicated that their approach to sustainability was actually strategic [3], and where a strategic approach is in place, efforts are often unmeasured and not tied to any form of performance metric. For example, only 18% of companies link employee pay to sustainability indicators [4].
So with such high levels of apparent commitment from the top as far back as 2010, why aren’t we seeing this translate into more positive action? Evidently there is a gap between understanding the importance of sustainability, and real action being taken to address it. With that in mind, here are a few tips and areas for eco-driven staff to consider on how to effectively encourage leadership to address operational sustainability holistically and strategically.
The business case for Environmental Sustainability
It really all comes down to the business case. As we already know, CEOs are aware of the climate crisis and understand the critical need to address it. But ultimately it seems, not at a cost to business as usual. Therefore, in order to gain leadership buy-in, the business case needs to be made. Importantly, eco-minded staff should do the research and ensure that the business case is backed up with hard evidence and data on cost savings, reputational benefits and risks, and the importance of future-proofing the business model from both an operational and moral perspective.
Cost efficiency
Consider researching and communicating the long-term savings an investment in sustainable solutions would have. Renewable solutions such as Ground Source Heat Pumps (GSHP) and solar panels will lower energy bills in the long term, have fewer maintenance costs, reduced service disruption, provide protection from price fluctuations, and have a stronger long-term return on investment.
For example, data from EnergySage suggests that commercial properties can reduce their electricity bill by 75% through installing solar panels [5]. There is also potential to sell energy back to the grid where there is surplus, not to mention the protection from price fluctuations like we are seeing with the current soaring energy prices in the UK and globally.
Eco-minded staff should try to source the information on their organisation’s overhead running, maintenance and energy costs and put forward some realistic and costed alternatives backed by well researched data. There is a wealth of information available on this online.
Reputational benefits
The reputational benefits from holistic and visible operational sustainability can drive greater commercial and fundraising returns, especially when communicated effectively. More and more investors and funders are channelling funds to, and investing in, organisations with strong environmental, social and governance commitments, and more and more clients and consumers are opting for businesses with strong environmental policies and practices. Eco-minded staff should consider what type of data and stats might be relevant to back up the business case based on their own organisation’s structure and business area, and include them in any business case aimed at strengthening leadership buy-in. For example:
- 92% of consumers say they’re more likely to trust brands that are environmentally or socially conscious and 87% of consumers would buy a product with a social and environmental benefit if given the opportunity [6].
- Overall sales revenue can increase up to 20% due to corporate responsibility practices [7].
- 66% of global consumers are willing to pay more for sustainable goods [8].
Reputational Risks
It’s also important to consider the reputational risks of inaction. As the consensus moves ever more towards addressing the climate crisis, organisations not acting are facing an ever-increasing risk of backlash from customers, clients, communities, and importantly, employees.
Staff retention is absolutely key to the smooth running of any successful business and leaders know this. Eco-minded staff should highlight this risk in their business case with evidenced facts and statistics such as 30% of UK employees said that they’ve left a job in the past because of the company’s lack of a sustainability plan [9] and 64% of millennials said that they wouldn’t take a job at a company that wasn’t socially responsible [10].
Future proofing
It is also important to consider the broader risks around inaction and to mitigate against them. Anticipate what regulatory, policy and market changes may be on the horizon, and the potentially significant resource implications these could incur if not addressed pre-emptively and strategically. There are already a number of environmental regulatory and reporting requirements in place for larger organisations such as Streamlined Energy and Carbon Reporting (SECR) [11], and obligations for major government suppliers to commit to net-zero and publish a carbon reduction plan [12]. More are also on the horizon, such as the UN Task Force on Climate and related Financial Disclosures (TCFD) targets which will be mandatory to report against from 2025 [13]. Eco-minded staff can point to these regulatory trends when explaining the importance of future-proofing the organisation.
Beyond this, there is also the much broader risk of impending climate change impacts on business operations, with all the economic, social and health issues associated with the ever-growing crisis. Arguably the most effective and important way to future proof an organisation is to mitigate against the severity of global climate change impacts. This requires widespread adoption of more sustainable practices and organisations, and therefore eco-minded staff should convince leadership that they have a moral obligation to play their part both as businesses and as global citizens.
Michael Porter and Mark Kramer summarise the approach nicely in the Harvard Business review article stating that “if . . . corporations were to analyse their prospects for social responsibility using the same frameworks that guide their core choices, they would discover that CSR can be much more than a cost, a constraint, or a charitable deed — it can be a source of opportunity, innovation, and competitive advantage” [14]. This is precisely what needs to be conveyed and evidenced to leadership to achieve their buy-in.
[1] Accenture, 2010, A New Era of Sustainability: UN Global Compact – Accenture CEO study 2010.
[2] Climate Change Report: FTSE100 Insufficient Carbon Reduction (eco-act.com)
[3] McKinsey, 2011, The Business of Sustainability
[4] Economist Intelligence Unit, 2010, Managing for Sustainability
[5] 10 Ways Renewable Energy Can Save Businesses Money – Renewable Energy Magazine, at the heart of clean energy journalism
[6] Do Customers Really Care About Your Environmental Impact? (forbes.com)
[7] Buying Green? Field Experimental Tests of Consumer Support for Environmentalism. | Michael J. Hiscox (harvard.edu)
[8] 73 Percent of Millennials Are Willing to Spend More Money on This 1 Type of Product | Inc.com
[9] Accenture, 2010, A New Era of Sustainability: UN Global Compact – Accenture CEO study 2010
[10] Why a sustainable workplace is key to attract & retain the best talent (ie-uk.com)
[11] Streamlined Energy and Carbon Reporting – SECR explained (complydirect.com)
[12] Procurement Policy Note 06/21: Taking account of Carbon Reduction Plans in the procurement of major government contracts – GOV.UK (www.gov.uk)
[14] Michael E. Porter and Mark R. Kramer, ‘Strategy and society: the link between competitive advantage and corporate social responsibility’, Harvard Business Review, December 2006
