Technology

Why CIOs Are Positioned to Lead the Sustainability Agenda



Before organizations can ethically claim that they are making a positive impact on the environment and in their community, they need to have the ability to reliably track and report on their carbon footprint. Consumers, investors, boards, and regulators today want transparency and reporting — not bold proclamations.

Even with basic key performance indicators, sustainability records are a challenge that is made more arduous due to a web of interdependencies and ambiguity. Information comes from internal and external sources, guidance follows several methodologies, and terms and metrics have not been defined. The C-suite executive who is best positioned to solve these data story problems and lead sustainability progress in their organization is the chief information officer.

CIOs can shape the discourse around an organization’s environmental, social and governance (ESG) commitments; support them with data; and achieve transparency and data security. By taking on the following six strategies, CIOs can take the lead on transformation and elevate their role within the C-suite:

1. Obtain trusted data and information

Organizations need accurate data to report against market needs and discover their own operational efficiencies. But first, they must determine what to measure, how to access data and which benchmarks to put in place. Companies frequently struggle with these foundational areas. CIOs can solve for this by bringing together the data and people, internally and externally; facilitating the conversation; and establishing trust through technology.

Collecting data from outside the organization requires a different strategy. Gaining the cooperation of suppliers and all downstream stakeholders to complete a checklist of metrics won’t be an easy lift, unless you can provide incentives, automate this task to the extent possible, and protect their data.

2. Unleash the power of technology

ESG efforts require that parties share trusted information. This can be in the form of blockchain-based reporting systems or other types of technology to automate information exchange without putting the data at risk.

To meet today’s needs and tomorrow’s requirements, start with a strong, flexible architecture. Build a framework that satisfies the needs of consumers, executive leadership, governing bodies and investors, and can track key metrics, such as carbon emissions, supplier diversity and labor practices, sourcing and plans for waste disposal. The system will need a central data repository with controls and processes that stand up to oversight.

While this is another heavy lift, it can be created incrementally. After you solve your first data story problem — data collection — you can use that data to tell a compelling story that propels the sustainability journey.

3. Be a transformational leader

Every organization is seeking efficiency. We know that climate change disclosure requirements are coming. We also know that organizations are more profitable over time when they create sustainable experiences. Getting ahead of these events and gathering data to steer the conversation means that the CIO can take the lead in helping the organization navigate the future.

A sustainability case study can begin within the IT department. Computing power requires massive energy use. Investigate ways to reduce energy consumption or use renewable energy sources at data centers. Find out how much money it can save and get buy-in from the CFO. Look into your supplier network. What percentage are women-owned businesses or minority-owned businesses, and how does that align with your ambition? Develop initial strategies, measure results, and use them to propel the sustainability journey.

4. Drive diversity in the organization

The CIO’s leadership role in sustainability starts from within the IT department, through developing a talent strategy that supports the organization’s future data science needs.

Studies show that diverse teams always outperform homogenous teams, yet women are underrepresented in STEM fields. Some cite a shortage of qualified talent. The real question is, “How can we break down barriers that lead to segregation and disparity, especially within the computing and technology workforce?” CIOs should participate in programs for women, minorities and children in STEM and develop plans for anti-bias practices in hiring and promotions.

5. Support stakeholder engagement

Cultivate relationships with your internal stakeholders, the CFO, marketing leaders, the heads of supply chain and human resources. ESG cuts across the enterprise. Each stakeholder has a different lens, and reporting requirements affect them all. Create connections across business units and define metrics so that you are not aggregating the same data twice or measuring inconsistently. The key to ESG data strategy development is to identify the right stakeholders, at the right time, to form the strategy and gain alignment.

6. Empower an ESG leader within IT

Organizations will need a different set of skills to tackle the business challenges that lie ahead. Embrace ESG as a subspecialty of IT and empower an ESG leader to drive that change from an executive level. This demonstrates a company’s commitment from the top down, and the ESG leader will be aligned to uncover new ESG strategies that can drive long-term value.

CIOs who take these steps will not only be prepared with a system that provides a holistic view of the business and audit-ready reports, but they will also be helping their organizations become more sustainable and resilient, and become better corporate citizens.

The views reflected in this article are those of the authors and do not necessarily reflect the views of Ernst & Young LLP or other members of the global EY organization.



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