Inside the emerging role of corporate energy managers

In the run-up to this year’s VERGE series of events that kicked off in Boston in May and continue in Paris on June 26-27, we worked with Groom Energy to launch our VERGE Energy Management research program. (To participate in our quarterly energy management research, click here.)

What we found is that, much like the emergence of sustainability executives, there has been a steady increase in companies dedicating a full-time resource to focus on corporate energy management. These sustainability and energy management roles complement and reinforce each other’s mission. However, while the ancillary benefit of a corporate energy management program is to reduce greenhouse gas emissions, the primary motivation for these energy managers is to reduce costs and increase operational efficiency.

Creating an echo effect

We asked more than 3,800 members of the GreenBiz Intelligence Panel to forward our survey to the person responsible for energy management within their company. We received 158 responses, 63 percent of which came from energy managers at companies with revenues greater than $1 billion. The results also reflect responses across a wide range of industries, primarily headquartered in the United States.

As illustrated below, the steep rise in the number of corporate energy managers parallels the rise in full-time sustainability executives (for more about the traits of sustainability executives, see our “State of the Profession” report, downloadable here). Since 1990, the number of full-time sustainability and energy managers has increased by twenty-fold (23 times and 20 times respectively). The growth rates aren’t the only similarity between these two roles as their governance structures use a cross-functional team to helps carry out strategy.

Since 1990, the number of full-time sustainability and energy managers has increased twenty-fold.

There are also significant differences between the roles. Sustainability departments may report into almost any functional area within a company, ranging from marketing to supply chain to legal. The energy management function tends to report into real estate/facilities (39 percent), the sustainability office (18 percent) or a dedicated corporate energy function (18 percent). Another difference between the two functions is that CFOs are more likely to be directly involved in overseeing energy management than they are global sustainability efforts. Our survey respondents noted that 23 percent of CFOs were very actively involved in overseeing energy management efforts while 43 percent monitored those efforts. Only 35 percent said that energy management was not a priority for the CFO.

Image by Peshkova via Shutterstock

Next page: Setting the strategy