Get your ESG story straight: A sustainability communication starter package

If U.N. Secretary Normal António Guterres’s declaration that the planet is “on a freeway to local weather hell with our foot on the accelerator” doesn’t encourage you to behave, it is probably not since you are heartless or that you just oppose environmental, social and governance initiatives. You in all probability are in favor of ESG — or a minimum of you’ll be by 2030, primarily based on the plethora of company commitments popping out of COP27. Among the many causes corporations reminiscent of yours battle to show declarations into outcomes is as a result of they’ve but to determine how.

Local weather motion finally comes all the way down to collaboration amongst decision-makers, so lagging motion might counsel relationship points. And why do relationships stall out or fizzle? Poor communication.

Right here’s one problem: “ESG” and, extra usually, “sustainability,” are two phrases that, had been I to hazard a guess, 99 p.c of individuals would battle to outline if placed on the spot. But stress is mounting on one hundred pc of public corporations to outline their ranges of sustainability in quantifiable phrases by reporting, at a minimal, their Scope 1 and a pair of greenhouse fuel emissions. With a possible mandate on public corporations to report Scope 3 emissions from upstream and downstream actions, suppliers are more likely to really feel the burden of compliance, compounding the stress on thousands and thousands of small companies in unsure instances. Whereas enterprise homeowners and managers might take part begrudgingly in reporting, it doesn’t imply they’re bought on sustainability.

For corporations of all sizes, speaking sustainability begins with sharing significant knowledge — however how this knowledge is introduced relies on the viewers.

Supporting provider sustainability requires greater than a forward-looking procurement course of. It takes dedication and collaboration throughout your complete worth chain — and that takes communication, not merely that which imparts data, but in addition educates, engages and mobilizes. Sadly, ever-changing requirements, definitions and duties complicate a dialog that many people nonetheless aren’t ready for, even when it’s of their job description. This isn’t to say that sustainability reporting isn’t occurring; in 2020, 92 p.c of S&P 500 corporations printed sustainability studies — however reporting and communication are two completely different animals. 

“On this house you possibly can even have an organization that is fully clear, however when you have 5,000 pages of textual content on an internet site, who may even get to what’s significant?” stated Beth Shiroishi, director of ESG communications at BrightLeaf Group, Inc., on the tradeoff that occurs when transparency impedes comprehension. 

Earlier than becoming a member of Brightleaf, Shiroishi performed an integral function in AT&T’s ESG transformation. In 2008, she constructed out the sustainability working infrastructure on the coverage aspect after which shifted to determining inform the story. Having walked the trail from company social accountability to environmental sustainability to ESG at one firm, she now advises corporations of all sizes on make sustainability significant. 

“I view it as a journey,” stated Shiroishi. “It’s not one-size-fits-all, and it issues who your stakeholders are and what your targets are. You actually have to determine what you are attempting to do, plan your journey and make incremental progress.”

The facility of a data-backed sustainability narrative

How can decision-makers steadiness the rising complexity of doing enterprise in a altering world with human limitations in capability and understanding? For corporations of all sizes, speaking sustainability begins with sharing significant knowledge — however how this knowledge is introduced relies on the viewers. 

For traders, speaking ESG is about conveying threat. As SEC Chair Gary Gensler said in regards to the company’s proposed rule, “If adopted, it might present traders with constant, comparable and decision-useful data for making their funding choices, and it might present constant and clear reporting obligations for issuers.”

Firms are prepared to conform, however lack of information standardization complicates communication. As Walmart Director of International Communications Aman Singh defined, “For years, corporations have struggled to report on their social affect in a financially significant means — and brought solace in reporting efforts vs. affect… But, there was little consistency in company disclosures.” Singh’s article on the rise of social metrics in ESG reporting provides a useful abstract of the metrics panorama, however for these at first of the journey, it’s sufficient to trigger ESG overload. 

Whereas knowledge issues, people want greater than knowledge to derive which means. A compelling and plausible narrative is vital for creating engagement and belief, particularly for workers and shoppers. Placing a stake within the floor for “sustainability” — whether or not CSR, DEI, ESG or the entire above — has by no means been extra necessary for public corporations, and more and more for personal ones.

“There are quite a lot of competing stress factors, and I personally suppose all of it results in extra reporting, and hopefully ultimately, higher-quality reporting,” stated Shiroishi. “However I do suppose that gone are the times of, ‘Oh, let’s simply go inform a enjoyable story about ourselves.’ Now it is extra like, ‘Let’s have a enjoyable story, ensure it is fully correct, genuine to who we’re, and considerate in the best way we publish it.’ However I additionally suppose you possibly can’t simply pull again as a result of we have handed that time. Individuals anticipate enterprise to have a viewpoint and be clear.”

The place your ESG story begins 

For corporations at first phases of the journey, listed here are seven methods to get your ESG or sustainability story straight:

  1. Get educated. Shiroishi recommends Joel Makower’s three-part collection on ESG rankings as a primer. For those who work for a small or midsize non-public U.S. firm or a startup, a lot of it might not apply (but), however figuring out the place issues are headed will make it easier to be extra strategic.
  2. Tune into completely different voices. If the calls for for extra data from regulators, traders, shoppers and social media influencers have you ever too nervous to talk, strive listening as a substitute to construct your data base. Listening to podcasts reminiscent of S&P International’s ESG Insider and ESG Speak will make it easier to learn the room earlier than you are taking a stand.
  3. Assess materiality. Decide the problems that matter most to your stakeholders and use these as a foundation for growing your organization’s technique. GreenBiz provides quite a few assets in its materiality protection right here
  4. If voluntarily reporting, determine on a practical framework to suit your stakeholders’ expectations and your dedication degree. “Measure what’s necessary, share what’s acceptable, however be cautious of the reporting rabbit gap,” advises sustainability strategist Scott Nadler. The formal ESG reporting terrain is shifting in mild of the SEC guidelines into consideration, which might require about 7,000 corporations to report climate-related knowledge utilizing a typical framework. Many are probably to decide on requirements set by the Worldwide Sustainability Requirements Board (ISSB) and/or the Activity Pressure on Local weather-Associated Monetary Disclosures (TCFD). Different widespread frameworks utilized by 1000’s of corporations embody the CDP for Scope 1, 2 and three emissions, and the GRI, the main requirements for speaking sustainability methods and targets to key stakeholders since 1997. Nadler acknowledges that formal reporting could be overly burdensome for sure sorts of companies. “For {most professional} companies organizations, for instance, there are three overwhelming elements to understanding your GHG emissions: workplace, journey and commuting,” he advises. “If you already know that and it suits, then you possibly can put collectively the spreadsheet.” Backside line: For those who vow to trace emissions, you want a system — however which system you select is as much as you and your stakeholders.
  5. Get licensed. Regardless whether or not or not your organization is voluntarily reporting emissions, you possibly can take actions that reveal commitments in different impactful methods. A variety of certifications exist, together with industry-specific ones reminiscent of these 33 inexperienced certifications beneficial by Trish Kenlon. Different applications such because the EPA’s Inexperienced Energy Partnership validate corporations’ use of third-party licensed inexperienced merchandise and encourage the event of U.S.-based renewable vitality. Appoint a cross-functional crew to vet these alternatives to make sure you select credible applications that align with your enterprise targets.
  6. Amplify your commitments with collective motion. Make your commitments to the Sustainable Growth Objectives extra impactful by aligning with others who’re equally dedicated. The U.N. International Compact provides applications for corporations with 250-plus workers and a particular observe for small and medium enterprises
  7. Create a communication technique. As soon as the constructing blocks of your sustainability program are documented internally, deciding what to go public with, and the way, requires a crew well-versed in public relations, built-in advertising and marketing communication, stakeholder engagement — and, in fact, collaboration. “It could take a while for them to see the profit,” stated Shiroishi of the completely different departments concerned, together with authorized, earlier than your sustainability story sees the sunshine of day. “As in every thing in life, there’s a price and there’s a profit, there’s threat and there’s potential. You have to be aware of that and suppose by the trail that may work finest to your targets.”

For these sustainability by an opportunistic lens, working the method could seem extra bother than it’s price. However for individuals who embrace it as a way of stress-testing your commitments, the end result is a narrative that meaningfully conveys your organization’s function as a pioneer, chief or catalyst. Grounding your company identification in an genuine ESG story can construct organizational resilience at this time, and a tradition to mitigate model threat tomorrow. It may even open the door to future progress alternatives. Once you take a look at it like that, what do it’s important to lose by beginning now?

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