Study: Sustainability experience required in tiny fraction of top executive hires

There remains a glaring shortage of "transformational" business leaders who look beyond short term profits to instead prioritise long-term corporate resilience, according to new research, which indicates sustainability experience is a requirement in just four per cent of high level management hires today.

With the world currently far off track to meeting the 17 UN Sustainable Development Goals by 2030, the first of its kind analysis released today by UN Global Compact (UNGC) looked at how business leaders are integrating sustainability considerations across strategy development, operational execution, and stakeholder engagement worldwide.

Based on in-depth interviews with 55 leading "sustainability pioneers", it concludes that expectations of CEOs, senior executives, and board members are changing, and that sustainability is increasingly seen as "a leadership issue and imperative to long-term success".

The report argues in the wake of Covid-19 there is now a significant opportunity for boards and C-suite leaders to place sustainability at the centre of corporate purpose and strategy. It adds that while corporate sustainability leadership starts at the top, "it must become part of the fabric of the organisation".

Lise Kingo, CEO and Executive Director of UNGC, said sustainability across business strategy was "not only the right thing to do, it's the smart thing to do".

"Enlightened CEOs and board members know that to succeed you need to be sustainable," she said. "We need leaders everywhere to step up their ambition and become agents for sustainable change. This is the moment for top management and boards to ensure that these critical competencies are represented and developed across the organisation."

However, the report also revealed that relatively small numbers of board-level executives are required to have in-depth experience of working on sustainability issue before taking up senior roles.

UNGC worked with executive recruitment firm Russell Reynolds Associates to gather expertise from CEOs and board members across different continents and industries with "a notable track record of focusing on and making progress towards sustainability goals in tandem with commercial results".

Those interviewed include former Unilever CEO Paul Polman, PepsiCo Latin America CEO Paula Santilli, Mastercard vice chair Ann Cairns, Neste CEO Peter Vanacker, and Microsoft's chief environment officer Lucas Joppe, among others.

The report sets out in detail what it describes as a "new model for leadership", based on four key umbrella leadership attributes needed for a "sustainable mindset", including multi-level systems thinking, stakeholder inclusion, long-term activation, and disruptive innovation.

In addition, Russell Reynolds Associates analysed how frequently sustainability was a factor in close to 4,000 executive appointment specifications worldwide in 2019. It found 15 per cent made reference to sustainability, but just four per cent listed sustainability experience or mindset as a requirement for the role.

As a result, the report warns that "businesses are doing a great job embedding talk of sustainability into descriptions about their company, but are falling short in driving decisions about which leaders to hire based on it".

Clarke Murphy, CEO at Russell Reynolds Associates, said the Covid-19 crisis had laid bare the critical role businesses have to play in tackling "persisting challenges in our societies and economies".

"We are calling for a new type of business leader - one who can drive long-term growth by integrating sustainability into business strategy," he said.

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• Topics
• Management
• UN Global Compact
• Sustainable Development Goals
• sustainable business
• Sustainability executives