4 ways to align an impactful ESG strategy with business goals

It’s a common challenge that internal sustainability leaders working at corporations face: How do you create an ESG strategy that aligns with the wider business goals?

Too often there’s the perception that two agendas are in conflict.

Many clients I’ve worked with have faced significant pushback to their plans from the C-suite, or struggled to engage other stakeholders across the business, many of whom fail to see the relevance to their department or role.

They’ve sometimes had to battle for every dollar of investment in building out a sustainability function or faced conflict with key decision-makers.

Challenging as it can feel, there are ways to work through this situation and create alignment between an organization’s plans for both its bottom line and the planet.

Watch our exclusive chat with Chelsea Mozen to discover how to align your business strategy with ESG goals.

1. Shift timelines

The short-term nature of commercial goals, be it revenue, profit or operating costs, can sometimes feel at odds with the much longer timelines required to achieve progress in ESG.

To overcome this, consider breaking down those long-term ambitions on environmental and social performance into short-term goals, to align timings more easily with existing commercial key performance indicators (KPIs).

At Etsy, for example, the team provides leadership with quarterly updates on its progress toward sustainability goals.

“We report alongside all other business units,” said Etsy Senior Director of Impact and Sustainability Chelsea Mozen at our latest Impact Leaders Lab event. “If the metrics haven’t moved, it’s just a great place for us to call out alignment with other business units and also, where we might be facing blockers or barriers, to allow us to get executive team buy-in.”

2. Share ownership

Every job is now a climate job.

Embed that sentiment by collaborating with other business units to create a sustainability strategy and then delegate responsibility for its different components to those same units.

Yes, you might lose an element of control, but the payoff is that nonspecialists feel empowered and engaged in the process and motivated to find alignment with their existing business KPIs.

At Etsy, Mozen moved the task of tracking and reporting carbon emissions to the accounting team from the sustainability function in 2020.

“It was hard to release a headcount when I’m a very small team,” she admits. “But we knew that in order to really make this work at the level it needed to be, it needed to be in the accounting world. So now we have an ESG analyst that sits in our finance team, and they manage that process.”

Mozen also takes every opportunity to put someone else’s name on an ESG-related project or task, rather than her own. “If I partnered with another team, I would rather them take the credit because then they’re even more bought in and feel a sense of ownership.”

3. Nail your pitch

By the time you pitch a new ESG project or initiative to the C-suite, you should already be confident they’ll back it.

Prior to any presentation, make sure you’ve socialized your ideas and gathered initial feedback from individual stakeholders. Use that feedback to rethink and reframe the ask. Understand any areas of conflict with the commercial agenda and ensure you’ve taken this into account and drawn up solutions in advance.

Then, create a two-stage phased pitch to senior leadership. First, ask to explore the concept or idea without any concrete commitment. This is an easy yes for execs. It also allows you as sustainability lead to gather even more feedback from them in a speculative capacity.

All this can then feed into the second formal ask. By this point, you’re speaking on a topic that’s already been broached with the C-suite individually and collectively, and that they’ve therefore already helped to shape and hone. This approach should considerably raise your odds of getting the green light.

4. Have conviction

Where you do encounter pushback as a sustainability leader, have conviction in your ideas.

Remember, you’re being paid by an organization to champion issues they may not have even considered before. It is your job to sometimes go against the commercial grain.

“Loyalty to my company is very important, but I firmly believe that my first level of loyalty is really to the issues, to driving positive social and environmental impact and change in the world,” said Etsy’s Mozen. “Loyalty to the company comes after that.”

Ranking her loyalties in this way makes Mozen better at her job, she added. “Sometimes you have to be willing to speak out or say things that others may not want to hear. I may not swim in the same direction as everyone else, [but] I was hired to do that, and my company wants me to do that.”

Balancing a sustainability strategy with the commercial goals of an organization can be tough. But by shifting timelines, proactively sharing ownership of projects, framing presentations for a corporate audience and working with conviction, sustainability leaders can find ways to align the two.