WHAT’S IN A CSO? — What exactly is a chief sustainability officer and what do they do? If you don't know the answer to those questions, you're not alone. They are ones that the executives themselves and the corporations that employ them are still trying to work out. In the early days of the sustainable investing movement, CSOs often performed functions more traditionally associated with public relations or marketing executives, touting their companies' environmental, social and governance initiatives for investors and the public. Now, as companies face pushback from the anti-ESG movement on the right and rising demands for real action to fight climate change on the left, CSOs are increasingly being called upon to take on tasks that better mesh bottom-line financial success with sustainability goals. The shift is reflected in a Deloitte survey that found 51 percent of CSOs reporting directly to the CEO in 2022, up from 31 percent in 2020. But even as they move closer to the centers of power in their companies, many are finding it difficult to make meaningful breakthroughs. “Many sustainability professionals inside organizations are frustrated because they see themselves as change managers and change leaders, and very often the rest of the senior leadership team — what they really want the person to do is to help protect shareholder value along with everyone else,” said Alison Taylor, a clinical associate professor at the NYU Stern School of Business and co-author of a recent CSO-focused article in the Harvard Business Review. “So in a way, the role of the CSO is really about this dilemma about what is the role of business in society, and how that's playing out internally.” While it’s easy to blame CSOs' struggles on companies’ inability to shift their focus from the bottom line to the future of the planet, some fault should be laid at the feet of the executives themselves, said Adam Carrel, a partner on climate change and sustainability services at Ernst & Young. "A certain proportion of CSOs are just becoming corporate functionaries,” said Carrel, who wrote a 2022 report on corporate sustainability. “They're people that never expected to be part of the C suite and frankly love the fact that they get a corner office and a cool job title and a car park and are not going to risk that by pushing a transformative agenda. Hate to say it, but it's true. CSOs are really captive to their organizations.” Hans-Juergen Walter, global sustainability leader at Deloitte, said that companies need to continue increasing their sustainability commitments to remain competitive and that while ultimate accountability rests on the CEO, more than half of financial firms surveyed said their CSO is the coordinator for net-zero strategy. Carrel isn’t shedding a tear over the increased scrutiny for CSOs and their companies. He said he’d rather “split the pack now” and find out which corporations are genuinely pushing for ways to solve climate change, giving way to a “more prominent” cohort of corporations and leaving those that may be caving to the anti-ESG agenda in the dust. “Very rarely do you see a sustainability function that actually has a mandate to drive sustainable transformation, which is a massive problem,” Carrel said. “We turned it into a relativistic subjective concept, where every company gets to reimagine it for themselves, and that's a falsehood. We have to drag it back to being something that is tangible in the real world.”
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