A growing number of chief financial officers (CFOs) are helping to drive sustainability strategies at their organizations -- and their involvement continues to increase even further, according to a global survey released on Tuesday by Deloitte Touche Tohmatsu Limited (Deloitte).
The survey, conducted by Verdantix, points to how more and more CFOs around the world are engaging in sustainability as they come to realize the key role it plays in financial and business success.
Drawn from the responses of 250 CFOs in 14 countries including the United States, Brazil and South Africa, Deloitte found that two-thirds of CFOs are involved in their company’s sustainability strategies. More than half of those surveyed say their involvement has grown in the past year.
The CFOs said they were more involved in guiding their organization’s overall sustainability strategy, assessing sustainability risk, investing in sustainable technology across a broad spectrum (from videoconferencing to electric vehicles) and communicating with a variety of people from investors to their own employees on such matters.
David Pearson, Deloitte sustainability leader and one of the authors of the report, said the survey results show how important sustainability has become to the financial and operational success of businesses large and small.
“CFOs’ growing embrace of sustainability means it’s no longer a ‘nice to have’ – it’s an integral part of business around the world,” Pearson said.
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For the past few years, there’s been an increased focus on the ways sustainability efforts are changing the traditional job description of a CFO. As more emphasis is placed on sustainability initiatives within an organization, the need for involvement from senior executives has increased.
Sustainability decisions – around such issues as resource management and sustainability data – continue to grow in scope and scale, requiring CFO input, Pearson said. CFOs are also starting to see the cost-saving benefits of certain sustainability initiatives such as energy management.
There was a marked change between this year’s results and results from the same survey in 2011, Pearson said. The percentage of CFOs that are engaged in sustainability issues at their companies jumped from 20 percent last year to 36 percent this year.
CFOs also appear to be more aware of sustainability and hands-on across the board in virtually every category, from operational choices to investment decisions, Pearson said.
The CFOs reported an increased focus on the sustainability aspects of tax and financial reporting, like the value of green credits and incentive measures. More than 70 percent of CFOs reported cost-savings in their financial reports, while more than 50 percent reporting savings relating to tax matters. More than half of the CFOs also said they planned to invest in video conferencing and data center efficiency equipment, and 35 percent in electric vehicles, to reduce their company’s carbon footprint and energy use from data centers.
Pearson said this doesn’t signal the demise of CSOs; rather, the rising importance of sustainability points to a growing need for involvement from a cross-section of a company and the alignment of sustainable practices with business goals.
“CFOs and COOs, relative to CEOs and CSOs, often have their hands around the issue from a systemic operational perspective,” he said. “It’s more that the issue set is growing and expanding than that they’re replacing CSOs.”