From regulatory pressures to consumer and investor demands and brand reputation, it has become imperative that organizations develop a sustainability strategy. But focusing on why it’s needed and what to set as goals and deadlines is one thing; focusing on how to actually operationalize the strategy is another – and many are struggling to successfully meet their ambitious targets.
We recently sponsored a Harvard Business Review Analytic Services report, “Emerging Strategies for Operationalizing Sustainability Efforts,” which explores exactly this and narrows in on the challenges businesses are facing as they transition from setting goals to achieving them, and how sustainability leaders* are setting themselves apart.
The report found that while many organizations have made sustainability commitments, only 1 in 4 say they’ve widely operationalized their sustainability strategy across the business1. And facing even more aggressive targets and societal pressure in the coming years, the remaining 75% risk falling further and further behind.
Another common thread across the report is an inherent need to break sustainability out of its silo. Sustainability efforts can no longer be the sole responsibility of a single individual or team. Operationalizing sustainability requires transforming all parts of the business and encouraging cross-functional collaboration that involves all facets of the organization.
At Daggerwing Group, we see people teams as having a unique and untapped opportunity to help accelerate sustainability strategies and shift employee behaviors as well as mindsets to quickly build momentum throughout the organization.
Here are four ways to embed HR in your efforts to operationalize sustainability:
1. HR can play a pivotal role in sustainability communications
According to a SHRM survey, 86% of workers said their employer’s ESG goals made them proud to work for their company, made their jobs more meaningful, and made them want to stay with their organization.2 As the importance of ESG grows among stakeholders, so does the need to transparently communicate about it – and HR plays a critical role in doing this successfully. The responsibility of HR goes beyond promoting awareness – your people team should help mould the message, particularly those around social issues, and connect the dots between sustainability and an organization’s strategy, purpose, and culture. In doing so, HR can improve employee engagement and satisfaction.
2. HR can unleash sustainability as a reputation and talent driver
Sustainability has become increasingly important in attracting and retaining talent, particularly those new to the workforce. In a recent Gallup study, 70% of U.S. workers said an organization’s environmental record is important to them and is a consideration when deciding whether to take a job.3 Another cited companies most attractive to students and young professionals have ESG scores 25% higher than the global average.4 As prospective employees continue to seek out purpose-driven companies, HR should find opportunities to incorporate ESG into the employer brand and emphasize it throughout the recruitment and onboarding process.
3. HR can help address barriers to operationalizing sustainability strategies
Operationalizing sustainability is incredibly complex and requires cross-functional support to make it happen. So, where can HR jump in? Three barriers many organizations are facing that people teams can help address are:
- Human capital: Organizations are struggling to allocate sufficient resources to achieve their goals
- Retention: Meeting sustainability goals often requires new skills and knowledge, and turnover of key roles threatens the progress made
- Measurement: Demonstrating progress to stakeholders is critical, but many organizations struggle to find the right ways to monitor and report their sustainability efforts
4. HR can bring sustainability into the business
Making meaningful progress against your organization’s ESG commitments requires fundamental changes to how the business operates. This means evolving processes, systems, and policies to incorporate sustainability – many of which are not owned by the teams advancing the day-to-day work. HR can drive system-wide change by helping to embed sustainability into the areas of the business they manage, such as employee rewards and recognition, performance management, and executive compensation. By weaving sustainability into the employee experience, HR can shift the perception of ESG as a separate initiative to a central pillar of how the business operates.
Operationalizing sustainability and meeting hard-hitting goals takes the work of your entire organization. As you craft your 2024 strategic plans and align priorities for the year ahead, your HR team can play a critical role in creating a more people-centric approach that will drive real progress in advancing your sustainability goals.
*Leaders are defined as those who have operationalized a sustainability strategy widely throughout their organization
4 Marsh & McLennan: ESG as a Workforce Strategy