Sustainability: the challenge to businesses and the talent landscape



This year, the UK is hosting the biggest climate conference in the world: the 26th UN Climate Change Conference of the Parties, known as COP26. Held in Glasgow in November, heads of state, climate experts and campaigners will convene at the event to formulate an action plan to tackle climate change.

Businesses will have a critical role in driving this progress. Thankfully, almost every company today has a sustainability strategy – the business case for sustainability has never been stronger, and the issue is now impossible to ignore. The crescendo of businesses attaining B-Corp accreditation is testament to this.

Customers, investors, and employees alike are demanding that companies play a more active role in progressing social, political and environmental change. As a result, a business’ stance on sustainability is being factored into purchasing decisions: a recent report from Accenture found that 60% of consumers were making more environmentally friendly, sustainable or ethical purchases since the pandemic began, with 90% intending to do so in the long term.

“Customers, investors, and employees alike are demanding that companies play a more active role in progressing social, political and environmental change.”

Against this backdrop, it was no surprise that this year’s The Grocer conference was named How to Build a Sustainable Brand. At the event, which took place back in March, leaders including Tesco CEO Ken Murphy discussed the key issues and opportunities facing businesses today, and what role companies can play in creating a more sustainable world.

One item firmly on the agenda for CPG brands and retailers is packaging. According to research by Trivium Packaging, nearly three-quarters (74%) of consumers are willing to pay more for sustainable packaging. In response to this increased awareness, large players are rethinking their approach to how they package products. Ferrara Candy Company, for example, has announced that it aims to make all of its packaging 100% reusable, recyclable or compostable by 2025, and PepsiCo has committed to eliminating all virgin plastic from its beverage bottles under its Pepsi brand in nine European markets by 2022.

Another key issue explored at the conference was net zero. In the last few months (many companies’ announcements coincided with 2021’s Earth Day), large businesses have made or updated their commitments to achieving net zero carbon emissions. PepsiCo and Coca-Cola Europacific Partners have committed to be net zero by 2040, with Nestle and Diageo targeting 2050. Excitingly, these sorts of changes will require never-before-seen levels of corporate collaboration between businesses and their suppliers, and it will be interesting to see the long-term impact of sustainability efforts on supply chain relationships.

Cragganmore Distillery
Diageo is targeting net zero carbon emissions by 2050.

In the consumer-facing sector and beyond, sustainability is becoming more aligned with long-term business strategy, and the most forward-thinking businesses are evolving their definition of sustainability beyond environmental issues. As a result, where the topic sits in an organisation is changing: when once it was grouped together with CSR, today leaders are recognising that sustainability is an individual and significant contributor to business success.

From a talent perspective, this manifests itself in a number of ways. Firstly, we are seeing more and more businesses embrace sustainability by appointing chief sustainability officers to their top tables. According to a recent report looking as US hires, more CSOs were appointed in 2020 than in the previous three years combined. Even smaller companies, such as Ella’s Kitchen, employ a head of sustainability (with the job title “head of the good stuff we do”).

“Sustainability leaders operating at C-suite level must make sense of what is happening externally – from scientific developments to changes in the law and regulation – and advise on how to adapt business strategy accordingly.”

Sustainability leaders operating at C-suite level must make sense of what is happening externally – from scientific developments to changes in the law and regulation – and advise on how to adapt business strategy accordingly. They must speak the language of business, effectively manage and persuade stakeholders and have a firm grasp on business principles outside of the sustainability topic.

Historically, sustainability leaders have been subject experts – scientists or policy advisors drafted in from other sectors to advise on environmentally-friendly growth. When Unilever appointed a chief sustainability officer in 2014, for example, it brought in policy expert and former White House climate change advisor Jeff Seabright. But in today’s world, commercial acumen can be more valuable than specific expertise on climate change or regulation. With this in mind, businesses are faced with two options: to upskill sustainability experts in business principles, or rotate leaders from core functions into specific sustainability roles. Procter & Gamble’s approach provides an interesting case study. Virginie Helias, who had been with the business since 1988, was appointed as CSO of P&G in 2016, following five years of ‘proof of concept’ roles that included Sustainability & Digital – Household Care and Global Sustainability Director.

Proctor & Gamble's World HQ
Virginie Helias, who had been with the business since 1988, was appointed as CSO of P&G in 2016.

In many ways, closer attention is being paid to the role of the chief sustainability officer since the outset of Covid-19, when the ESG and commercial agendas were forced closer together. The more businesses are expected to deliver long-term value for customers, society and the planet, the more significant a role the chief sustainability officer will play. Moreover, the pandemic in some ways acted as a ‘dress rehearsal’ for future climate crises – demonstrating the need for preparedness in the face of systemic global issues.

“The more businesses are expected to deliver long-term value for customers, society and the planet, the more significant a role the chief sustainability officer will play.”

We can expect to see the role and purpose of a sustainability lead evolve further. Chief Impact Officers are becoming more and more common (one high-profile appointment here was Prince Harry, who made headlines earlier this year when he became the CIO for BetterUp). Indeed, in some businesses, sustainability is even getting non-executive board level representation, as organisations appoint environmental experts to help guide them through the next chapters.

As we approach November 2021 and COP26, we can only expect public pressure on companies to increase. Businesses have a critical role in the fight against climate change, and those not prepared to play their part will find themselves outrun by more forward-thinking competitors. One thing’s for sure: the sustainability agenda is making a permanent mark on the talent landscape.

Huw.llewellynwaters@thembsgroup.co.uk Joseph.ball@thembsgroup.co.uk | @TheMBSGroup