How CEO Commitment Affects Sustainability Integration

Sustainable LeadershipSustainabilityBoard and CEO AdvisorySustainability Officers
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February 09, 2023
3 min read
Sustainable LeadershipSustainabilityBoard and CEO AdvisorySustainability Officers
Executive Summary
CEOs must commit to embedding sustainability into organizational strategy. Here's what happens when they do.
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Overall, there is a strong commitment to sustainability and a sense that progress is being made, but there is notable variance across industry and country.

Organizations need an increased prioritization of sustainability strategy, and this prioritization often starts at the top. CEO commitment to sustainability is key to the success of an organization’s overall sustainability goals. Russell Reynolds Associates’ Global Leadership Monitor delves into how committed CEOs are to sustainability, with a global sample of 1,590 executives from different geographic markets, industries, and company sizes to explore how top leaders can excel at sustainability integration.

In this three-article series ‘Commitment to Sustainability’, we delve into research from the Russell Reynolds Associates’ 2021-2022 Global Leadership Monitor and 2021 Divides and Dividends to help organizations in different geographic regions and industries build and maintain effective sustainability strategies for the future.

Ultimately, executives need to fully grasp three key areas when setting sustainability goals and metrics. Read on below to learn how CEO commitment affects sustainability integration, or navigate to our other articles in the series.

  1. How CEO commitment affects sustainability integration

  2. Framing sustainability through a value creation lens

  3. Holding executives accountable: tying financial metrics to sustainability outcomes

 

How CEO Commitment Affects Sustainability Integration

While some organizations may have a chief sustainability officer, for many organizations, the sustainability strategy still falls under the responsibilities and purview of the CEO. As the CEO is the face of the organization for many facets of organizational strategy, it is important that they are overtly committed to embedding sustainability into their overall organizational strategy.

 

quote You could have all the right language and commitment statements, with sustainability programs line up, and still fail. If you don’t have an inspired and inspiring leader at the top, it’s not going to happen.

-Clarke Murphy
Sustainable Leadership: Lessons of Vision, Courage, and Grit from the CEOs Who Dared to Build a Better World

 

As companies move away from simple PR statements around sustainability commitment, many of which are designed with brand and image management in mind, and more towards a value creation approach, CEOs should be at the forefront of communicating the organization’s sustainability goals to internal and external stakeholders.

This communication is an important first step, as organizations with CEOs who are publicly committed to sustainability tend to feel more prepared to address external factors impacting the future health of their organization than those with CEOs who have not voiced public commitment to sustainability. Most particularly, organizational preparedness toward sustainability in terms of climate change and environmental damage, trade conflicts, and investor activism.

 

Global view: How committed are CEOs to sustainability?

Executives generally feel their CEO is personally committed to advancing sustainability and that progress is being made, with just 10% of overall global leaders feeling their CEO has no commitment to sustainability. CEO commitment is viewed in relatively high terms globally, but there is some variability between role levels.

 

CEO Publicly Committed to ESG

Yes, the CEO is personally committed to advancing sustainability, and organizational progress has been made

60%

 


Yes, the CEO has expressed support for advancing sustainability but not yet acted

 

17%

 

CEO Not Publicly Committed to ESG

No, the CEO has not publicly expressed support for advancing sustainability

10%

 


I do not think our CEO has a real commitment to sustainability in my organization

 

4%

 

Source: Russell Reynolds Associates’ 2022 Global Leadership Monitor Survey, n = 1,590 global executives.

 

Regional view: CEO commitment highest among China/Hong Kong and UK

CEO commitment to sustainability is markedly high across all regions. Most notably, more than 9 in 10 executives in China and Hong Kong believe their CEO is committed to advancing sustainability within their organization.

 

Has your CEO personally committed to advancing sustainability in your organization?
By Country

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Industry view: Industrial and natural resources industry demonstrates high commitment towards sustainability advancement

While more than three quarters of leaders globally believe their CEOs are personally committed to sustainability, there are important differences in commitment levels across industries. While 93% of leaders in the industrial/natural resources (INR) industry say their CEO is committed, only 65% of leaders in professional services and 63% in healthcare say the same.

 

Has your CEO personally committed to advancing sustainability in your organization?
By Industry

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Turning these insights into action

Assess current state of CEO commitment and involvement in sustainability

Assess CEO commitment
CEOs committed to sustainability goals increase executive confidence in effectively pursuing sustainability opportunities. The CEO's ability to galvanize the board of directors and C-level executives to embrace sustainability is key in integrating sustainability in overall organizational strategy.

 

 

 

 

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Commitment to Sustainability Series

Framing Sustainability Through the Value Creation Lens

 

 

 

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Commitment to Sustainability Series

Holding Executives Accountable: Tying Financial Metrics to ESG Outcomes

 

Methodology

2021/2022 Global Leadership Monitor
The Global Leadership Monitor is an annual online survey of executives and non-executives. The Global Leadership Monitor tracks key threats to organizational health and leadership preparedness to face them, as well as indicators of confidence in leadership, and leaders' engagement and career aspirations.

All data has been weighted by GDP to create a more representative share of business contribution from each market. Not all percentages in charts add up to 100% as a result of rounding percentages and the decision in certain cases to exclude the display of certain sectors and “neither/nor,” “unsure,” “other,” “none of the above,” and “don’t know” responses.

Russell Reynolds Associates surveyed our global network of executives using an online/mobile survey in February and March of 2021, and in March of 2022.

2021 Divides and Dividends Research
The study was conducted with 9,500 employees and next-generation leaders in 11 growth and mature markets from April 16 to May 12, 2021.

 


 

Authors

Beth Hawley is a member of Russell Reynolds Associates’ Center for Leadership Insight. She is based in Chicago.
Tom Handcock leads Russell Reynolds Associates’ Center for Leadership Insight. He is based in London.
Gabrielle Lieberman is a member of Russell Reynolds Associates’ Center for Leadership Insight. She is based in Chicago.

Acknowledgments

Francesco Menonna is a member of Russell Reynolds Associates’ industrial/natural resources team. He is based in New York.