Sustainability 2.0: The CSO's Role Keeps Growing

As sustainability gains more prominence in the enterprise, the role of the chief sustainability officer has steadily evolved.

Sustainability, balance sheet

By Samuel Greengard

Over the course of a decade, sustainability has morphed from a fringe and feel-good idea embraced by a handful of companies into a mainstream business concept. In recent years, companies—particularly Global 2000 firms—have appointed chief sustainability officers (CSOs) and others to oversee a spate of initiatives ranging from corporate sourcing, packaging, and greenhouse gas emissions to waste, recycling, and working conditions in overseas factories.

"There has been a fairly significant change in terms of what organizations and chief sustainability officers are focused on," says Will Sarni, a director at Deloitte Consulting, who notes that the role of the CSO has evolved far beyond compliance and basic green issues. "The CSO is increasingly involved in business operations, business decision-making, the introduction of new products and services, and global environmental and social issues," Sarni explains. In fact, the CSO's reach now touches virtually every corporate function, including operations, research and development, marketing, financial, legal, and human resources.

This changing landscape directly impacts CIOs and enterprise IT. Organizations require increasingly sophisticated monitoring, tracking, analytics and reporting tools to manage sustainability initiatives effectively. "In order to achieve significant results," Sarni says, "sustainability must be baked into a business strategy, particularly as companies evolve from a focus on framing environmental and social issues in a compliance-centric way and adopt broader thinking and policies that center on driving sales, managing risk, engaging customers and shareholders, and reducing operating costs."

STMicroelectronics Reduces Its Water Footprint

STMicroelectronics, a global producer of semiconductors based in Geneva, Switzerland, is among the companies focused on Sustainability 2.0. It strives to improve its water footprint, use eco-design techniques for products and find ways to engage employees in community involvement. Philippe Brun, corporate vice president of human resources and sustainable development at STMicroelectronics, says CSOs must embrace new thinking and technology in order to drive changes in today's enterprise.

For example, 20 years ago, STMicroelectronics would have focused solely on reducing water consumption, Brun points out. That initiative later grew into improving wastewater treatment to reduce water pollution. "Now, in addition to addressing these issues, we are working on our water footprint, including water risk assessment and mitigation at our sites," says Brun. This involves considering the local environment but also the impact of water management on the supply chain.

At STMicroelectronics, "CSO responsibilities are increasingly shared among groups as sustainability becomes more embedded in day-to-day operations," Brun explains. What's more, the CSO's job is becoming more complex. "A CSO must consider risk management for shareholders, including but not restricted to environment, health, safety, conflict minerals, human rights, and more; product leadership for customers; and people engagement for all our employees," says Brun. There's also a need to manage different expectations from customers across companies and countries, he notes.

STMicroelectronics formalized its sustainability strategy in 2011 by assembling a key group of vice presidents and other sustainability experts. "We sought insight from both internal and external sources," Brun says. That effort helped align business priorities and stakeholder expectations and, using that aligned approach, the company identified 22 top sustainability issues. And STMicroelectronics's Sustainability Council reviews the strategy, progress and specific tactics at least once a year.

The role of the CSO, CMO and CIO increasingly intersect, says Sarni. Digital technology allows stakeholders, private organizations and the public to monitor corporate policies and activities in deeper and broader ways than ever before. At the same time, organizations can conduct a level of analysis and oversight that would have been unimaginable a few years ago. Sustainability increasingly equates with business performance, differentiation and the bottom line, Sarni explains. "The role of the CSO is changing to both reflect and drive change within today's business environment."

About the Author

Samuel Greengard is a contributing writer for CIO Insight. To read his previous CIO Insight article, "Employees: The Weakest Link in Security?", click here.

This article was originally published on 03-26-2014
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