As we have reported, the new regulations that are being implemented around the world will ultimately impact all companies.  Some companies will be impacted immediately and others over time.

This article in CFO Magazine suggests you take these three steps to prepare

  • Appoint a Chief Sustainability Executive
  • Create an ESG policy budget
  • Assess Partner’s sustainability practices

We appreciate the suggestions, but recommend against this direction.

First, take a breath.

Second, decide if you even want to jump right in to an ESG program.  We recommend you not going straight to an ESG program.  Our recommendation is to start with becoming certified sustainable, then add carbon neutrality certification, then ESG, and finally Net Zero.  This is typically both the easiest and the most profitable progression path. 

Third, if you agree with starting with sustainability, then read this PPP on the kind of program you might want to consider.

Fourth, if you follow the outline in the PPP, you will be forming a Green Team and your advisor will be assisting you with not only becoming certified but executing your go-forward plan.  That advisor and your Green Team will help you define your initial strategy; and with it, whatever budget you may initially need.  Further, out of that strategy will come a better understanding of if you need to hire a sustainability officer or if it would be better to delay that hire until you get a better idea of what you need in that position.  Like all hiring decisions, if you are not clear on the duties, the odds of the person succeeding will be low.  A year or two under a sustainability certification with your Green Team supported by your 3rd party consultant will help you determine what you need in that role. 

As to addressing the sustainability practices of your partners (ie, vendors), you need to be certified sustainable before asking your vendors to do things you have not yet done.  Get certified sustainable before you pick up the phone and call your vendors. 

As to carbon footprint reduction, same as above.  Once you are certified sustainable and are comfortable with the progress of your program, move to carbon neutrality.  You will define your own carbon footprint, and determine the steps you need, per your sustainability plan, to become certified carbon neutral.  After that, you can call your vendors and discuss their carbon program, as you have already spoken with them about their sustainability program and their progression should mirror your progression. 

This is not hard.  This is not expensive.  But it can be, if you don’t follow the correct sequence.