ESG in the Boardroom: The CXO’s Priorities

economictimes.indiatimes.com:

Advertisements stating that there is no “Plan-et B” and that we owe it to ourselves to take care of our environment are getting more common by the day. Even as regulations around ESG (environmental, sustainability and governance) are becoming stricter, the CXOs and business leaders need to keep redefining their investments, priorities and actions in this space. In India, the Securities and Exchange Board of India (SEBI) has been getting more stringent with the reporting requirements. As reported in ET Prime on July 19, 2023, the Business Responsibility and Sustainability Reporting format has been updated, with a need to capture key ESG performance parameters, provide “reasonable assurance” for the numbers through audits and processes and also reimagine how the supply chain for the company can be made sustainable. There are various aspects of preparation for this. While the requirements will start from the largest listed companies, over time, more companies will need to show their commitment to ESG in quantitative terms.

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It would involve providing disclosure on financial information and risk management practices, governance policies, setting up the right data collection systems, training people and partners and closing gaps in the processes. What does that mean for business leaders? McKinsey said in its analysis titled, “Turning ESG aspirations into results: The role of functional leaders” that the need to spend time on ESG activities was evolving across functions. As we had analysed earlier, often CXOs such as chief financial officers or chief sustainability officers have the overall responsibility for ESG practices within a company. But