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Giving sustainability a real seat at the table

High-street fash­ion is in a stir. For the first time, one of the world’s four largest fash­ion hous­es, Stock­holm-based H&M, has a woman at the helm. But it’s not only gen­der that marks out Hele­na Helmers­son, it’s her CV.

Helmers­son has bounced around a num­ber of func­tions dur­ing her 22-year career at H&M. After a stint in pur­chas­ing, she has com­plet­ed spells in human resources in Bangladesh, glob­al pro­duc­tion in Hong Kong and, most recent­ly, as oper­a­tions chief back in Swe­den.

Yet, her star real­ly began to shine dur­ing time as the brand’s head of sus­tain­abil­i­ty between 2010 and 2015. She won plau­dits for help­ing blaze a trail for greater cir­cu­lar­i­ty through recy­cling and reuse of gar­ments. On her watch, H&M’s use of sus­tain­able cot­ton more than tripled and the vol­ume of used clothes col­lect­ed from stores quadru­pled.

But it wasn’t all ros­es. Most notably, her time over­lapped with the high-pro­file col­lapse of a cloth­ing fac­to­ry in Dha­ka, killing more than 1,100 work­ers and rais­ing seri­ous ques­tions about labour stan­dards in the sup­ply chain. H&M was not direct­ly involved, but as a sig­nif­i­cant pro­cur­er from Bangladesh, it felt the rep­u­ta­tion­al fall­out.

Helmersson’s stel­lar rise indi­cates that the C‑suite is, at long last, open­ing its doors to sus­tain­abil­i­ty. But what does this mean for the cur­rent crop of sus­tain­abil­i­ty lead­ers? And how, if at all, might it reshape future board­rooms?

Sustainability leaders: more hard-headed

For sus­tain­abil­i­ty lead­ers, H&M’s deci­sion is wel­come, but some per­spec­tive is required. C‑suite recruiters are not about to start search­ing sus­tain­abil­i­ty depart­ments for their next chief exec­u­tive hire.

That’s the view of Mike Bar­ry, at any rate. He should know. For near­ly 15 years, he head­ed up sus­tain­able busi­ness at UK retail­er Marks & Spencer. Dur­ing that time, he saw social and envi­ron­men­tal issues occu­py increas­ing amounts of board­room time and head­space.

Lead­ers need to be less of a sci­en­tist or spokesper­son, and more engaged in what the busi­ness does and how it does it

Until now, sus­tain­abil­i­ty pro­fes­sion­als have over­whelm­ing­ly been sub­ject experts, Bar­ry notes. Typ­i­cal­ly, they would start out as envi­ron­men­tal man­agers, as he did, and slow­ly move their way up. Now that’s all chang­ing.

Sure, sus­tain­abil­i­ty lead­ers must be on top of their brief, he says. But they also need to be com­mer­cial­ly mind­ed and knowl­edge­able about core busi­ness, as com­fort­able with a prof­it-and-loss state­ment as a car­bon emis­sions’ chart.

“Today’s chief sus­tain­abil­i­ty offi­cer needs to be less of a sci­en­tist or spokesper­son, and much more engaged in what the busi­ness does and how it does it,” he argues.

For the cur­rent cadre of sus­tain­abil­i­ty lead­ers, this may well mean upskilling. Pre­vi­ous­ly, a basic famil­iar­i­ty with core busi­ness man­age­ment, includ­ing mar­ket­ing, inno­va­tion, oper­a­tions, organ­i­sa­tion per­for­mance and so on, was suf­fi­cient. Now, only a thor­ough grasp will do.

Helping broaden leaders’ skillset

It’s a trend that Sophie Walk­er, UK head of sus­tain­abil­i­ty at glob­al pro­fes­sion­al ser­vices com­pa­ny JLL, is well aware of. On join­ing the UK plc board in Jan­u­ary, after five years on the exec­u­tive team, she approached the firm’s chief finan­cial offi­cer to help her get up to speed on the fun­da­men­tals of cor­po­rate finance.

But upskilling exist­ing sus­tain­abil­i­ty lead­ers is not the only option. Anoth­er is to rotate experts from oth­er core busi­ness func­tions into board-lev­el sus­tain­abil­i­ty posi­tions. In addi­tion to the hard-edged busi­ness acu­men they offer, they can bring a strong dose of com­mer­cial cred­i­bil­i­ty to the role.

It is a tac­tic that ING has used with great suc­cess. When the Dutch bank was on the hunt for a new sus­tain­abil­i­ty direc­tor five years ago, it opt­ed for a com­plete new­bie. Pri­or to his appoint­ment, Léon Wij­nands had worked almost exclu­sive­ly in sales and cus­tomer ser­vices. Sus­tain­abil­i­ty, he ini­tial­ly imag­ined, was some­thing peo­ple did along­side their real job.

Sustainability on boards agenda

Expe­ri­ence quick­ly taught him oth­er­wise. Under pres­sure from envi­ron­men­tal cam­paign­ers, cli­mate-con­cerned investors and finan­cial reg­u­la­tors, Wij­nands ordered a root-and-branch assess­ment of the cli­mate risks inher­ent with­in the bank’s loan port­fo­lio.

Five years on, he is as con­ver­sant as any sus­tain­abil­i­ty nerd on strand­ed assets and cli­mate-relat­ed finan­cial dis­clo­sures. More impor­tant­ly, under his direc­tion, ING is now dri­ving for­ward an indus­try-wide ini­tia­tive to encour­age the bank­ing sec­tor to align its future lend­ing with glob­al cli­mate goals.

Building board expertise

ING hasn’t giv­en up on turn­ing off the office lights or giv­ing to char­i­ty. But what Wij­nands’ com­mer­cial mind­set brought to the board was a sense of how sus­tain­abil­i­ty fits into the big­ger strate­gic pic­ture, the finan­cial risks the sub­ject rep­re­sents, the mar­ket oppor­tu­ni­ties it presents and the macro-trends it taps into.

“The key impact that you can cre­ate as a leader in a com­pa­ny is to inte­grate sus­tain­abil­i­ty into the DNA of your depart­ment or your busi­ness unit or, ide­al­ly, the whole organ­i­sa­tion,” he says.

The sen­ti­ment pre­cise­ly echoes the thoughts of Cather­ine Har­ris, a New York-based sus­tain­abil­i­ty spe­cial­ist with recruit­ment firm Acre. Har­ris is author of a recent whitepa­per that calls for com­pa­nies to rejig their gov­er­nance struc­tures to “bring the voice of soci­ety” into the board­room.

Cre­at­ing a so-called social board can be achieved through a vari­ety of mech­a­nisms, she sug­gests. Notably absent from her list is reliance on a spe­cial­ist sus­tain­abil­i­ty depart­ment, as is the cur­rent norm. The issues at stake are now sim­ply too broad, and too strate­gi­cal­ly impor­tant, to be palmed off.

Instead, just as sus­tain­abil­i­ty lead­ers are hav­ing to brush up their core busi­ness com­pe­ten­cies, so too board mem­bers must get up to speed on sus­tain­abil­i­ty issues. Options vary, rang­ing from peri­od­ic board-wide brief­in­gs to inten­sive, indi­vid­ual train­ing.

An organ­i­sa­tion offer­ing the full gamut is the Cam­bridge Insti­tute for Sus­tain­abil­i­ty Lead­er­ship (CISL). Linked to Cam­bridge Uni­ver­si­ty, this spe­cial­ist cen­tre reports a huge rise in demand over recent years for board edu­ca­tion.

The rise of the “social” c‑suite

Not only are sus­tain­abil­i­ty issues now seen as crit­i­cal to future busi­ness growth, says CISL’s exec­u­tive direc­tor of edu­ca­tion Lind­say Hoop­er, but stake­hold­er demands on boards are also ramp­ing up dra­mat­i­cal­ly.

Peo­ple are look­ing to busi­ness lead­ers not just to be “less bad”, but to come up with real solu­tions to big sus­tain­abil­i­ty chal­lenges. If top exec­u­tives can’t respond when put on the spot, “then they are going to be on the back foot”, Hoop­er argues.Sustainable hiring dataset

Walk­er at JLL is alert to this chang­ing dynam­ic. Last Sep­tem­ber, she arranged for the company’s UK senior man­age­ment team to attend a two-day bespoke course about sus­tain­abil­i­ty lead­er­ship at CISL.

Her fel­low exec­u­tives didn’t emerge as overnight experts, she con­cedes, but they did come back with few­er fears and uncer­tain­ties about the sub­ject. The expe­ri­ence left them with a greater lev­el of com­fort about “what they know and what they don’t know”, she observes.

Harris’s vision for a social board sup­ports calls for stake­hold­er advi­so­ry pan­els. Made up of exter­nal sub­ject experts, the role of such pan­els is twofold to point out flaws in a company’s exist­ing prac­tice and to make boards aware of emerg­ing trends that could fea­si­bly impact the busi­ness.

Con­sumer goods giant Unilever, which is reg­u­lar­ly ranked as one of the world’s top sus­tain­abil­i­ty lead­ers, boasts such a pan­el. The sev­en-mem­ber advi­so­ry coun­cil includes a world-renowned expert in human rights from Har­vard, the con­ser­va­tion direc­tor at glob­al envi­ron­men­tal char­i­ty WWF and a for­mer sus­tain­abil­i­ty tsar for the UK gov­ern­ment.

The panel’s offi­cial role is to guide and cri­tique Unilever’s over­ar­ch­ing sus­tain­abil­i­ty strat­e­gy. The company’s head of sus­tain­abil­i­ty Rebec­ca Mar­mot puts it more blunt­ly, describ­ing its mem­bers as “crit­i­cal friends” to the chief exec­u­tive and his senior team.

Back to board basics

Whether fash­ion or finance, retail or con­sul­tan­cy, every busi­ness sec­tor now finds itself in the sus­tain­abil­i­ty fir­ing line these days. The plan­et is under strain and big busi­ness is an obvi­ous, and far from guilt­less, tar­get of blame.

But peo­ple also want answers. If the pri­vate sec­tor is going to con­tribute mean­ing­ful­ly, then sus­tain­abil­i­ty lead­ers and the C‑suite need to shift tack with more busi­ness know-how for the for­mer and greater sus­tain­abil­i­ty exper­tise for the lat­ter.

Cru­cial as a C‑suite shake-up cer­tain­ly is, the cen­tral func­tion of com­pa­ny boards remains the same. To quote Peter Trues­dale, direc­tor at con­sul­tan­cy firm Cor­po­rate Cit­i­zen­ship: “This isn’t about sav­ing polar bears.” Instead it’s about busi­ness lead­ers bet­ter iden­ti­fy­ing sus­tain­abil­i­ty-relat­ed risks and oppor­tu­ni­ties, and fac­tor­ing them into cor­po­rate strat­e­gy.

Done well, com­pa­nies will stand an infi­nite­ly bet­ter chance of thriv­ing in the future. So, hope­ful­ly, will the bears.