Is There a CSO in Your Company's Future?
One of the oddities of sustainability is where its responsibility lives inside companies. In short: anywhere and everywhere. Try asking a roomful of senior sustainability executives from mainstream companies their titles and to whom they report. You’ll find little consistency.
We did this earlier this month, at two meetings of the GreenBiz Executive Network we held in Chicago. (The membership in our peer-to-peer learning forum for sustainability executives has grown such that we had to split the group to maintain its intimacy.) Here are ten examples of members’ titles:
- Assistant Vice President, Sustainability and Tax
- Assistant Vice President, Citizenship & Sustainability
- Chief CSR Officer, VP Strategy & Business Development
- Director of Product Stewardship and Sustainability
- Senior Vice President, Global Director, Sustainable Solutions
- Vice President and Chief Information Officer
- Vice President, Responsible Livelihood
- Vice President, Brand Management & Sustainable Product Development
- Vice President, Corporate Responsibility
- Vice President, Workplace Safety and Environmental Stewardship Officer
I’ve omitted the ones you’d expect — Vice President, Environmental Sustainability, for example.
Where do they sit? About 27 percent report to public affairs, corporate affairs, or external affairs; about 13 percent to general counsel; another 13 percent to sales and marketing. The rest report to operations, strategy, products, environmental health and safety — as I said, anywhere and everywhere. In most cases, these execs sit a couple levels away from the CEO. A handful have achieved C-suite status: a chief sustainability officer, or CSO, reporting directly to the top.
Bottom line: It’s an emerging and still confusing world for corporate environmental executives. But there’s no doubt that the profession is rising up the ranks.
So it was of great interest to read an insightful new report on the state of the CSO, by Ellen Weinreb, one of my go-to resources on things related to the intersection of human resources and sustainability. Weinreb, whose firm Weinreb Group provides executive search and consulting in sustainability, has spent 15 years helping companies build internal capacity to address sustainability issues.
The new report, titled "CSO Backstory" (download - PDF), explores the emergence of the chief sustainability officer in corporate America’s C-suites, featuring CSOs in companies like AT&T, Coca-Cola, Dupont, EMC, Kellogg, SAP, and UPS. Weinreb’s aim is to offer companies “a real framework on how to leverage a growing consciousness on sustainability for business growth.” She calls the report “the first-ever data driven report of its kind concentrating on analyzing and encapsulating the essence” of the CSO role.
There are three data points that I found particularly interesting.
Date Point #1: twenty-nine. That’s the number of publicly traded U.S. companies that have someone with the title of Chief Sustainability Officer. Weinreb identifies them all — from Charlene Lake at AT&T to Roger McClendon at YUM Brands — including how long each has been in that position (three-fourths became CSO in just the last three years) and whether they were promoted internally (25 were) versus recruited from outside (only four).
That’s not the complete CSO universe, of course. There are CSOs in cities (Austin, Chicago, Las Vegas), divisions of larger companies (Diversey, GE Power, Saatchi & Saatchi), privately held large companies (Shaklee Corp., Novus International), and lots of smaller firms. Weinreb set her parameters tightly to get clear visibility on the nature and role of CSOs, not of sustainability executives in general.
It’s also important to note that the word “sustainability” means different things at different companies. At some, it’s synonymous with “environment.” At others, it encompasses the full spectrum of social and environmental issues, increasingly the preferred term for “corporate social responsibility” and other things.
Data Point #2: sixteen. That’s roughly the number of years the typical CSO has been with his or her company. “That tells me that companies place a lot of value in CSOs knowing the business,” Weinreb told me recently. “If you’ve got somebody there for 16 years, they’ve played multiple roles. They know how to make things happen. They can work within a matrix. They can work upon creating wins for other parts of the company, not just their own department. They know how to get things done.”
Of course, not all CSOs’ jobs are identical — far from it. A CSO’s role will be determined by a range of factors, including a company’s size, sector, and geography; pressure (or the lack thereof) from customers, competitors, investors, or activists; how far along the company is on its sustainability journey; the company’s appetite for change; its culture of innovation; and its organizational structure, among several other things. Clearly, there’s no one-size-fits-all recipe for success.
What they have in common is that they are “business veterans who are good at leading new initiatives, cross-functional teams, and understand how to translate external factors into internal opportunities,” according to Weinreb.
Data Point #3: four and two tenths. That’s the average number of direct reports CSOs have: 4.2 -- basically, enough for a round of golf. That’s a pittance when you consider CSOs’ mandates: to embed sustainability into the corporate fabric, simultaneously reducing waste, emissions and costs; engaging the workforce to create an environmental ethic, and keeping it alive year after year; keeping the company out of activists’ sights, but partnering with those that offer expertise or political cover; tweaking or overhauling procurement policies to increase green purchases; greening up buildings, facilities, and vehicles; and many, many other things, including identifying new business opportunities. Oh, and attending conferences and peer-to-peer events, like our Executive Network.
How do they do all these things with their tiny teams (and equally minuscule budgets)? By enlisting others, building bridges, forming partnerships, and sharing successes — not to mention persuading, cajoling, and sometimes begging and pleading.
Their success at doing this things can be read daily in the news stories of GreenBiz.com.
The elevation of sustainability inside companies is in large part a testament to the commitment and resourcefulness of CSOs and their ilk. As Weinreb makes clear, these executives have risen through the ranks, charted new territory, become external champions and internal change managers, and are helping their companies institutionalize sustainability.
That's a tall order. But as Weinreb makes clear, they're only just getting started.