Where CFOs see sustainability…
One thing we’ve noticed is that companies are very curious as to how they should structure themselves around sustainability.
Some say a new job role is required - the chief sustainability officer.
But others think this person would be made of twigs and look like Wurzel Gummidge (the scarecrow if you’re too young to know, check out the wiki), so prefer to put the chief financial officer in charge of such matters.
We see the need for both. A man in a bowler hat sitting opposite a scarecrow is a nice image to prevent the end of the human race, but really in the short run the CFO is the one who tends to be listened to. That could change, but right now, we think the CFO has more whack…
Anyway - this brings us on to the next point. A survey by Jones Lang LaSalle finds CFOs report sustainability is an increasingly important issue [never ;)] and that a range of financial benefits are achievable for companies that can also cut their impact on the environment.
The survey says:
- The greatest barriers to incorporating sustainability into financial strategy include the inability to measure the effects of sustainability on shareholder value (ranked among the top three challenges by 46% of respondents), inability to document the effects on financial performance (37%), and a lack of standard decision-making frameworks that consider environmental factors (36%). The least significant challenge was organization resistance, ranked among the top three barriers by just 20% of respondents.
Quite interesting. But it adds:
- More than half of finance executives believe their companies are “very likely” or “somewhat likely” to increase revenue, reduce operating costs, improve investor returns and shareholder value, and improve employee retention through sustainability. The most often cited benefits were reduced risk (”very” or “somewhat” likely to produce benefits at 78% of companies), enhanced brand and reputation (77%), customer retention (72%), and improved employee health and productivity (68%).
- The highest priority objectives in corporate sustainability are regulatory compliance (ranked as a high priority for 61% and a mid-level priority for 26% of respondents), improving energy efficiency and reducing greenhouse gas emissions (a high priority for 47%, mid-level for 32%), and reducing the environmental impact of operations (45% and 32%).
