What CSR and Sustainability leaders Think
Many ESG activities and programmes are being managed by CSR and sustainability leaders, from small contributors to CEOs.
CSR and sustainability professionals at all levels are taking on increased responsibility for ESG activities, from strategy to practice, since ESG risk is becoming a key concern for organizations. The individuals driving change in this area must comprehend how ESG practice is growing, how peers are managing ESG risks, what resources are available, and what to do about reporting, among other concerns, in order to manage these increasing obligations.
We conducted a survey of more than 500 CSR and sustainability professionals earlier this year to learn more about how their roles are changing, what drives their companies to address ESG risks, the main ESG challenges they are facing, the tools their peers are using to overcome those challenges, and much more.
CSR and Sustainability leaders
Seven important findings from The Morningstar Sustainalytics Corporate ESG Survey Report 2022 are highlighted in this post. for all the information.
First Insight: Sustainability and CSR Teams now oversee more corporate ESG initiatives
Many ESG activities and programmes are being managed by CSR and sustainability experts, from small contributors to CEOs. According to the poll, 89% of respondents oversee 50% or more of their companies’ corporate ESG efforts.
The majority of respondents to the survey are very or frequently involved in reporting and disclosure (95%) as well as target setting and measurement (95%) and programme planning (94%). Finance (60 percent extremely or usually involved) and supply chain management (76 percent) take up the most of their time.
Insight #2: Goal-setting and KPI-Setting Are Delaying Companies’ Adoption of a Strategic Corporate ESG Approach.
64 percent of survey participants said their companies have a formalised corporate ESG strategy. Another 26% of businesses are still formulating their strategies.
The findings shed light on the difficulties that business ESG programmes face as they develop. 78% of respondents claim to have recognised the ESG concerns that are most critical to their corporate strategy at the first stage. Only 61% of companies, however, have established explicit objectives and/or KPIs for their strategic ESG challenges. Companies seem to be struggling the most with the process of choosing and implementing goals and KPIs.
Insight #3: Building successful corporate ESG programmes presents structural, technical, and cultural challenges for CSR and sustainability professionals.
At every point of their corporate ESG journeys, businesses face difficulties, including significant structural, technical, and cultural problems. Budget restrictions (which, according to 35% of respondents, have a severe impact), a lack of human resources (34%), the measurement, reporting, and disclosure of results (33%), goal and target setting (32%), and compliance with regulations/standards (28%), are the issues that CSR and sustainability professionals face the most.
These three difficulties are all connected to crucial actions needed to develop a successful company ESG programme. This implies that respondents are resolving anticipated problems, but they could require extra assistance.
Fourth insight: There is a demand for consultants to help with ESG issues
External consultants (61%) external ESG standards and/or guidance (58%) such as the Global Reporting Initiative or Task Force on Climate-related Financial Disclosures (46% internal hires) are the most frequently used resources by CSR and sustainability professionals to address corporate ESG challenges. Only 17% of respondents said they used sustainable financing to address their ESG concerns.
When compared to other survey results, this indicates that sustainable finance is handled by other departments and that respondents are more concerned with the practical aspects of corporate ESG: understanding their important ESG issues, setting goals and targets, measuring and reporting, planning and executing, probably with assistance from consultants or outside service providers.
Insight Five: For sustainability and CSR teams, the environment is the top ESG priority.
According to the respondents, social and corporate governance issues together are less significant than environmental issues. Environment is ranked as the most important factor by 53% of respondents, followed by corporate governance at 25% and social issues at 22%.
However, the data paint a slightly different picture when “most important” and “moderately important” evaluations are combined. When seen in this perspective, environmental issues continue to be the most crucial overall, followed by social issues and governance. These findings suggest that businesses are beginning to pay more attention to social issues.
Sixth Insight: ESG Measurement and Reporting Teams Recruit Third-Party Support
Businesses that increase their ESG efforts always see the necessity to adhere to national, regional, or industry requirements. The majority of businesses have chosen at least one reporting framework to direct their operations and have enlisted outside help for measurement and reporting.
60% of firms, when it comes to ESG assessment and reporting, turn to outside experts. Compared to the usage of ESG software (22%), financial institution guidance (6%), and ratings providers (33%), this alternative is far more popular with businesses.