Who is your CSO?

A popular aphorism goes like this: “Show me your friends, and I will tell you who you are”.

Working on the same principle, if one knows the profile and background of the person leading ESG/Sustainability in a company, one can understand much about the organization’s focus. It is also crucial to understand, at what hierarchical level is the position to understand the influence the person can generate inside the organization. The person’s professional background can indicate the focus (read bias) that person will bring to different aspects of sustainability. These perspectives matter as the Chief Sustainability Officer (CSO) is becoming a powerful position as we witness their presence increasingly across many critical discussions.

I took the top 100 listed entities in India per market cap and researched the people leading ESG/Sustainability in each organization. Although the position may have a different designation than CSO, I am considering the person leading ESG/Sustainability as CSO for this article.

I could find only 62 companies in the top 100 having a specific person identified to lead ESG/Sustainability. Given the importance the subject has gained since 2020, one would expect almost all companies to have this position. Of the 62, only 46 have full-time responsibilities, while 16 have multiple responsibilities and sustainability being one of those. A full-time position is not required if the organization has reached a maturity status and integrated sustainability into everything it does. But I doubt any Indian company has reached that status yet. Hence, not having a full-time position does not give stakeholders the right kind of message, at least for big organizations. From a gender perspective, only 10 are women, and the rest, 52 are men. Since the subject is an amalgamation of different topics, I do not see a reason why there cannot be a gender balance.

The average experience working in this space across the 62 individuals leading this function is 11.4 years. It ranges from 6 months to 28 years. 41 of the 62 are senior management, which indicates the person’s influence, but 12 of them are at this position in the last three years or less. While senior leaders are involved, for them to drive this agenda, they need to improve their competence on the subject. For example, if the CSO has worked for the last 18 years in the HR function, the person needs to improve their knowledge across all other dimensions of sustainability. It is a relatively tricky task in senior positions. Having specialist teams below the leader can help nullify the competence gap. If a company engages a senior professional to lead sustainability, it clearly sends out a message about how important it is for them.

When you look at the function or stream of work these 62 individuals have come from, it is unsurprising to see Environment or Environment, Health and Safety (EHS) dominating this. This can be attributable to the relative importance environmental topics have across the ESG/Sustainability domain. Operations is the next, again, because the environmental impact results from the operations. The next positions from where people have become CSOs are Operations and HR functions. We can also find professionals from finance, marketing & communication, and Strategy functions now as CSO. The past work domain sends a message to the outside world about how the organization plans to take its sustainability path forward. If led by a person from risk and compliance, it gives an image that the company approaches the subject from a risk and compliance angle. On the other hand, if led by a person from product development or research, it sends a message about how the company looks to integrate sustainability into their future products.

When you look at the educational qualifications, science and engineering are the degrees for most CSOs. It is a reminder that we still think, the solution for most of our sustainability challenges will be solved by technology. It is high time we realize that for a sustainable world, we need to change our accounting and our economic indicators of prosperity structurally, make our laws more inclusive and ensure that we create the future generation that can bring about the behavioural change that is required etc.

Of the 62, 51 of them have a master’s degree, and 25 of them have a master’s degree in management. Although the stream of education will not be a dominant factor in deriving a perspective, it is essential to recognize that we need to integrate sustainability in every stream of education. The success of sustainability is when the role of CSO perishes, but for that nirvana status, miles to go…

While there is no fixed profile for the role of CSO, organizations should realize that selecting a person for the role itself is sending a signal to the stakeholders. While the outside world can draw perspectives about the company’s drive for sustainability by looking at the person leading ESG/Sustainability, it is up to the individual how they want to steer their organization. It will require them to shed the biases they carry because of their education and their previous roles and responsibilities.

I would relate the CSOs to an elephant; they are big and visible these days; they should have big ears to hear what the stakeholders are saying, they should have the authority and clarity in their walk, and they should be smart to understand where to take risk, they should have empathy and should show, they should be very good in communication and should remember the paths they have taken for success and failures, and this knowledge should be transferred to the next generation to chart their journey.

In the end, the CSO should be one of the biggest believers in the need for a sustainable world; there is nothing called conditional support regarding sustainability. Either you are fully in or not.