Three Recommendations for Boards to Monitor Corporate Sustainability

With increasing regulator, investor, and customer interest, board members must pay more attention to their company’s sustainability practices, impacts, and disclosures. The days when boards can view these as “soft issues” that they can ignore are quickly passing. Focusing on quantitative sustainability metrics and linking to innovation initiatives are ways that board members can help drive long-term corporate performance and value.
 
If you have 10 minutes or so, watch this @BoardResources interview with Evan Harvey (@EvanHarvey99, Nasdaq’s Director of Corporate Responsibility) for a great overview about why and how boards of directors should be more involved in their company’s environmental, social, and governance (ESG) programs. 
 
I concur with Mr. Harvey’s three recommendations to boards about how they can begin to monitor sustainability more responsibly:​

1. Create a board committee dedicated to overseeing sustainability issues (or at least embed a sustainability or ESG sub-committee into an existing committee such as the finance or oversight committee).

• I’d supplement this recommendation by noting that boards should be diversifying their membership by adding members with sustainability expertise.

1. Seek at least annual reporting about trending performance and challenges from the company’s main point of contact(s) for ESG programs.
2. Conduct independent research about the company’s ESG programs, impacts, and disclosures, especially comparing performance with sector peers and competitors and forecasting long-term issues.