Guest Blog: Embedding an ESG mentality (part 1)

Guest Blog: Embedding an ESG mentality from the C-suite to the stationery cupboard

 This article was written by 4leaf Coaching founder, Julia Fawsley Grant. 4leaf is an affiliate organisation of ESGmark®. It is a coaching consultancy that partners with small companies to keep their founding principals at the forefront of everyday business - working to make sure they remain both purposeful and profitable.

Not every business founds its value proposition entirely on positive social impact, but that doesn’t mean the business can’t look for ways to meaningfully contribute to the world around it. In recent years pressure on the corporate world has moved from damage limitation to positive contribution - and most recently to active regeneration.

If you as a founder, CEO or senior manager are taking your business towards a more ‘ESG’ friendly mentality, you need to take your team and employees with you. How best do you embed your ESG culture in a way that extends beyond management protocol? Your ESG success stands or falls by your staff engagement.

An important question is to ask whether you are ‘designing’ an ethical company or are you working with a pre-existing groundswell of employee enthusiasm? As more and more millennials enter the work force, there is increasing pressure from the bottom up to make sure a company has some kind of ethical framework that the business adheres to. Whereas once a CSR policy allowing workers a day’s volunteering at the local soup kitchen was considered groundbreaking, ESG expands far beyond its predecessor’s scope to look at every aspect of a company’s influence and the implications of its business activity. There is ever more evidence that workers expect their company to not only outline its ESG policies but to deliver tangible benefits to the world outside their HQ. Which is to say that it is far simpler to establish an ESG mentality when you are working with a group of likeminded colleagues. Even if your team(s) is already engaged in some form of general community activism, making a set of ethical and sustainable guidelines applicable to every-day business is easier said than done - especially if your business is not founded on a product type that, in itself, is geared towards positive impact.

Below are just a few pointers for how to start going about it. Depending on where you are with your policy and rollout, all, some or just one of the pointers we discuss in this blog might be useful. Part 1 touches on leadership, un-silo-ing ESG and enabling and empowering colleagues to uphold ESG best practice.

Leadership. Who is leading the charge? And why? Leaders have a multiplier effect - leading by example creates an environment that allows others to make similar decisions, especially at the beginning when policy changes add a layer of complication to what might have been straightforward business conversations. If you’re working with ESGmark® then it is already clear that this is more than a PR exercise but you still need to get your internal messaging spot on. What is the organisation’s new/updated ESG policy - be specific on this - why are you rolling it out and what are you aiming to achieve? The policy needs to be positive in its mission and unambiguous in its aims. In short, the senior leader in charge of roll out must be the Cheerleader-in Chief.

Un-silo ESG. Too often company initiatives for making positive change have either been left to teams of volunteers juggling their full time job with their ESG work, or if a company does have dedicated resource, these people are kept in an entirely separate workstream to the rest of the business. Positive impact initiatives are isolated from everyone else and therefore the work is seen as supplementary or “a nice thing to do” - rather than a critical part of responsible citizenship. Uncoupling business responsibility issues from the core organisation leads to ad hoc initiatives that can leave swathes of the wider business unengaged as well as a host of missed opportunities. Not every company can build its entire value proposition around a social issue but virtually every moment in a company’s working processes or supply chain has an impact on something or someone outside the business. Use your colleagues’ expertise in their own areas to help develop the broadest possible infrastructure of ‘positive’ touch points; make ‘making a difference’ a critical by-product of everything you do along your value chain.

Enable and empower. How are executive management enabling their operating teams and middle management to make these changes and use the framework as part of their every day business decisions. In order to make meaningful change, decision making under a newly instated or redefined framework has to be as easy as possible. Key to this is defining your cost imperatives and allowing teams to make decisions within given parameters. The costs of greening a business are ever decreasing but at some stage you will come across a procurement decision that pits ESG standards against cost imperatives. i.e. how will you empower your teams to balance ESG with the P&L? What and where are the incentives and boundaries?

Look out for Part 2 of this blog, which explains how identifying appropriate metrics, education and culture are important considerations in the journey to strengthening the ESG credentials of your business.