Sustainability – both social and environmental – has quickly risen to the top of corporate agendas in recent years. This is in part because of the growing evidence that sustainable practices result in improved financial performance, and in part due to pressure from investors, employees, and the public for companies to articulate the role they play in addressing societal challenges. As one director recently told us, sustainability “has never been a higher priority for the board than it is today.”
In 2020, Russell Reynolds Associates published a study in partnership with the United Nations Global Compact examining the attributes that make executive leaders effective at driving sustainability outcomes. In this paper, we study the issue from the board’s perspective, looking at how corporate directors engage with the challenges and opportunities related to sustainability, how they structure and operate the board to oversee related activities, and ultimately, how they enable sustainable in the enterprise.
To better understand the board’s role in sustainable leadership, we interviewed more than 130 corporate directors and C-suite executives from around the world, surveyed more than 1500 additional corporate leaders, conducted an extensive analysis of executive- and board-level talent and recruiting practices, and leveraged our deep expertise in sustainable leadership and corporate governance practices.
What emerged from this research is an awareness of just how much board directors struggle to take the first step toward engaging on sustainability. From those boards who are already leading on sustainability, it illuminated a 10-step roadmap toward progress, touching on items as wide ranging as board culture, risk management, and corporate purpose.