As environmental rules and regulations continue to change and uncertainties abound, the world’s top asset managers, including BlackRock, Vanguard, and State Street, are putting increased pressure on corporate boards to release more climate-related data and include it as part of their governance systems. There’s even a growing trend to place climate experts in key advisory roles.
These moves to increase the flow of climate-related information has created a global call-to-action for companies to analyze their exposure to the impacts of a warming planet. Boards not only need to be knowledgeable about material climate risk, but they also need to be capable of preparing for its impacts, as well as capitalizing on its opportunities.
Board-level competence around climate change and other sustainability issues is now essential. The only way to achieve that competence is through a deeper understanding of what climate change means and why it matters to a business. But, just bringing in one climate-competent individual may not be enough. Corporate leadership and boards must look to create an entire environment of knowledgeable people. That’s where education tools and strategies come into play and can make a sizable impact.
Putting the Right Strategies in Motion
The massive amount of need-to-know information today’s corporate leaders must navigate, including evolving environmental policy, seems insurmountable. But achieving climate-competent leadership teams with extensive sustainability knowledge is possible. By leveraging the right tools and resources, today’s boards can stay informed and feel confident that they’re making sound decisions for their organizations.
A first step is to implement actionable strategies so corporate leaders can take the necessary steps to educate themselves and their colleagues on the most critical issues facing their business. It is essential to define what the most critical sustainability issues are impacting their business. For example, an auto manufacturer may not need to focus its attention on water pollution issues and policy, but they absolutely have to be well versed in air quality issues.
It’s equally important to align the organizations’ goals in achieving full understanding about those issues. Should the board enlist outside resources? What group of experts and stakeholders should they engage with to get the full picture on their core issues? What kind of investment, whether it’s time or money, is required and leadership willing to spend? All of these questions should be answered before any next steps are taken.
Another common challenge to overcome in the building of a climate-competent board strategy is making sustainability goals stick in day-to-day business operations. Engaging leadership on a regular basis to create a sustainability culture from the top down is necessary. The good news is that there are plenty of resources that can help in the process.
Resources that Make it Manageable
There are excellent solutions available to transform massive amounts of data in the form of sustainability developments and regulatory decisions, into usable information that translate into actionable insights. When the decision is made to take the next step to invest in tools and resources, it’s good to know that there are a number of effective digital platforms that cover the full range of today’s environmental topics. These digital platforms include balanced news articles, insightful analyses, current statistics, and reprints of key official documents. Many even offer objective news and commentary, original reporting on legislative and regulatory developments, court and administrative decisions, compliance news, government policies, and international standards. These platforms are a treasure trove of information and make it possible to do in minutes what many have tried to do in weeks and months.
It’s clear that climate issues are not the only thing today’s corporate leaders have to manage, which makes timesaving tools that are available on many digital platforms a must-have. Digital resource platforms also make it easier for business leaders to follow the news as it develops and then customize their experience to suit their needs. Timesaving tools, like email snapshots, morning previews, customizable alerts and instant links to primary source documents, make it simple to manage massive amounts of information.
It’s possible to amplify and simplify a climate-competent board strategy by leveraging today’s latest digital tools to stay on top of environment-related information. Knowing what’s available and what steps to take to achieve climate goals within an organization is key. Knowledge is power in this sense. Organizations that increase their knowledge about today’s most critical issues surrounding the environment will be well positioned to make sound decisions that benefit the entire company and its valued investors.
By Mark Kozeal, Director, Bloomberg Environment