This is another challenge that boards and directors must face by recognising the need to change and do so urgently, while the climate change clock is ticking. A recent global report by Diligent* on environmental sustainability at board level, found that Australian and New Zealand boards are ahead when it comes to tackling these issues, with 60% of the respondents having these conversations at least annually, while North America and Europe lagged behind at 46%. Interestingly, 89% of the respondents expect an increase in these discussions over the next 3 years, while the main motivators behind these numbers for these organisations seem to be; societal impact, long-term viability and reputational risk.
Company Secretaries have a pivotal role in this, which was discussed extensively at the ICSA Conference a few weeks ago. As the board’s adviser the Company Secretary should encourage the conversation on sustainability, help directors think differently, but also look at how other organisations are approaching the subject and work collaboratively with governance professionals to ensure best practice is achieved in this area. They can help organisations determine which approach would work best, based on their location, industry, operations and ownership. Reporting on ESG is also important as it is a chance to measure and improve results, but also celebrate environmentally friendly actions and hopefully prompt others to do the same.
The conversation on environmental and sustainability issues has started and although there are difficulties, boards are starting to recognise the risks and opportunities associated with these. ESG is increasingly positioned at the top of board agendas and for organisations to remain competitive and successful they need to recognise this, with help and guidance from their Company Secretary.
I’d love to hear your thoughts on how Company Secretaries can drive excellence on corporate social responsibility, sustainability and environmental issues. Let me know your thoughts in the comments.
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*To see the full report visit: https://diligent.com/au/resources/winds-of-change-environmental-sustainability-rises-to-the-board-level/