When it comes to “walking the talk” of sustainability, the type of board directors matters.
There is growing evidence to suggest that sustainability is getting more attention in the boardroom. However, with a big gap between board members’ aspirations regarding sustainability and its integration into the heart of their organisations’ activities, there remain questions as to just what is being discussed, how it is being discussed and why.
To get a better understanding of how seriously directors view sustainability, we interviewed non-executive directors from 50 large, well-known European companies. Their responses were both varied and refreshingly frank.
One director told us that sustainability on his board had been referred to as “the last wagon in the train”. Another spoke of “the new CEO’s toy”, while a third summed up his company’s ‘technocratic approach’ when he admitted, “We are listed much higher on the Dow Jones Sustainability Index (DJSI) that we think we should be. Apparently, we have become very skilled in filling out their 300-page questionnaire.”
On the other end of the spectrum, we spoke with directors who recognised the importance of integrating sustainability into their firm’s strategy.
As one interviewee noted, “Sustainability is no longer only about the environment. It has developed into a more holistic and broader view that you could call long-term value creation.”
A closer analysis of the various attitudes – which ranged from out-and-out scepticism to fervent belief – revealed five archetypes of behaviour.
- The denier
- The hard-headed
- The superficial
- The complacent
- The true believer.
True to the adage “birds of a feather”, there was a tendency by directors to gravitate towards companies where the same type would surround them. However, many found themselves on boards where other members were less convinced of the relevance of sustainability to the business. When profiling the different types, we identified strategies to help these directors push back and keep sustainability on the boardroom agenda.
Read the rest of the article at Insead Knowledge