When it comes to corporate decarbonisation and the pursuit of net-zero emissions, having an engaged board and executive team who are committed to the topic is foundational to success. This article lists some critical functions that an engaged board and executive team will be able to carry out.
Set the tone and direction for sustainability
First and foremost, the board and executive team's commitment sets the tone and direction for your entire organisation. A resolute commitment to decarbonisation and net-zero targets communicates that sustainability is integral to your business strategy. A recent survey by PwC found that 79% of CEOs believe that demonstrating a commitment to reducing carbon emissions is essential for building and maintaining trust with stakeholders.
Allocate resources
Moreover, this commitment translates into resource allocation. Your board's support ensures that the financial and human resources necessary for decarbonisation initiatives are available. For context, a report by CDP revealed that companies committed to addressing climate change invested £11 billion in emissions reduction projects in 2020. Having the board's backing ensures that you have the means to invest in sustainable technologies and practices.
Catalyse cultural shift
The commitment of your board and executive team also catalyses a cultural shift within your organisation. It fosters a climate-conscious ethos, where sustainability becomes a shared responsibility across all levels. Research from Deloitte shows that companies with engaged executive teams are 3.4 times more likely to be leaders in sustainability.
Acknowledge inherent business risks
The board's dedication acknowledges the inherent risks climate change poses, including regulatory changes, supply chain disruptions, and reputational damage. Having your executive team take these risks seriously gives you the ability to critically examine your organisation's business model with a sustainability lens and places you in a position to effectively develop and implement strategies for mitigation and adaptation.
Enable stakeholder management
Additionally, your board's engagement enables effective stakeholder management. Investors, customers, and regulators increasingly scrutinise environmental performance. A demonstrated commitment to sustainability builds trust and can reduce the risk of reputational damage. A survey by Schroders found that 54% of investors believe board-level involvement is crucial for climate-related disclosures. Furthermore, this commitment encourages a long-term strategic approach. Pursuing net-zero emissions requires a vision that extends beyond immediate financial gains.
Board and executive team commitment is pivotal for your corporate decarbonisation journey towards net-zero emissions. Their leadership guides strategy, allocates resources, nurtures a sustainability-focused culture, and mitigates risks while bolstering brand reputation and stakeholder trust. It is the cornerstone upon which your organisation's sustainable and resilient future is built.