is undergoing a rapid and dramatic transformation. Historically CSOs have acted like stealth PR executives—their primary task was to tell an appealing story about corporate sustainability initiatives to the company’s many stakeholders, and their implicit goal was to deflect reputational risk. The role had virtually no involvement in setting company strategy or communicating it to shareholders; those responsibilities fell to the CEO, the CFO, and the head of investor relations.
Moving the focus from feel-good corporate social responsibility to hard-nosed sustainable value creation requires pragmatic leaders who are willing to admit that not all ESG measures are win-win—that is, good for the planetfor the bottom line. Companies need more nuanced and rigorous discussions about the trade-offs and conflicts that exist among stakeholder interests, and among environmental, social, and governance issues.
Moving the focus from feel-good corporate social responsibility to hard-nosed sustainable value creation requires pragmatic leaders. CFOs will also have to change. Maria Luiza Paiva, who was appointed executive vice president of sustainability at Brazil-based mining company Vale after two devastating dam collapses shook investor and stakeholder confidence, frequently participates in investor meetings with the CEO, CFO, and head of investor relations. Paiva envisions her role as temporary; her goal is to embed sustainability throughout the organization. “My role should be biodegradable,” she says.
CSOs need experts on their team in relevant topics such as climate, biodiversity, supply chain, and human rights, but they also require collaboration from individuals across various business units and functions where sustainability is critical to success. These individuals, often connected through dotted lines and sustainability committees, contribute to embedding sustainability throughout the organization.
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