Spencer Stuart and Diligent: 71 Percent of Boards Are Considering ESG For Their Future Strategy

According to a new report released today by Spencer Stuart, and Diligent, 71 percent of company boards are taking into consideration ESG (environmental, social and governance) objectives and goals into their overall strategy, with 85 percent working proactively to increase the smoothness on ESG working. 

The report titled 'Sustainability in the Spotlight: Board ESG Oversight and Strategy' talks about how  600 global board directors are addressing ESG and structuring oversight to help their companies tackle the challenges and opportunities that affect their success. The survey indicates that 43 percent are keeping a hawk's eye of ESG at the full senior-most, board level. 30 percent keep a track of ESG developments within the nominating and governance committee of the company and 15 percent within the specially constituted committee for ESG/Sustainability, these trends indicate that they are likely to become a common element of the board committee structure.  

Some of the top findings of the report include:  

• Prior to the pandemic, about 20 percent of respondents said they ever discussed ESG. As the economy is reopening, the percentage who say they discuss ESG at every or nearly every meeting has more than doubled, from 15  to 34 percent.
• Only a handful of companies have governance structures in place to work proactively on their ESG goals. Only 33 percent of respondents said their organisations are rethinking their ESG  practices.
• Now ESG metrics are increasingly becoming a part businesses. 71 percent of respondents are incorporating ESG goals and vision into their overall strategy. Meanwhile, 52 percent are incorporating ESG into integrated risk management, 46 percent in executive compensation, and 48 percent into their criteria for director appointments.  
• Corpoprate are proactively building their ESG competency. 85 percent are taking action to increase board competency around ESG, with 42 percent bringing in consultants from outside, and 38 percent engaging in director education and upskilling.