A Day in the Life of a CSO
Agenda spoke with CSOs from different industries about their roles
Read Time: 3 minutes
By Lindsay Frost | August 01, 2022
This article was initially published by Agenda
Sustainability leaders in a variety of industries told Agenda their jobs are becoming busier and more important to stakeholders.
The chief sustainability officers, who work in the agriculture, pharmaceuticals and utilities industries, are getting more face time with the board than ever before, which they said is crucial. (For more, check out the companion story to this piece, “‘Insatiable’ Demand for Chief Sustainability Officers.”)
Agenda spoke with three CSOs and a global head of sustainability about their day-to-day responsibilities, whom they report to and how the role is expected to evolve. Sandy Nessing, vice president and CSO of American Electric Power (AEP) and Caroline Roan, CSO of Pfizer, were interviewed via phone, while Pilar Cruz, CSO of Cargill, was interviewed via e-mail. Meanwhile, Rachael De Renzy Channer last week was named global head of sustainability at management consulting and recruiting company Egon Zehnder and was interviewed by email. The interviews — which reveal a wide range of responsibilities and reporting structures among the companies — were edited for clarity and length.
Lindsay Frost: What are your primary responsibilities as CSO?
Pilar Cruz: As [CSO] and head of our corporate responsibility and global communications functions, it’s my responsibility to bring our purpose to life, to drive impact and ensure we are delivering value as a trusted, reliable supplier for our customers. As part of my role as CSO, we have developed and launched a clear strategy in three priority areas: climate, land and water and people. These priorities define our path to advancing sustainable supply chains and driving positive impacts in the communities where we work.
Sandy Nessing: My team, which is small … [is] responsible for all of our non-financial disclosure, the [environmental, social and governance] portion. This includes the annual sustainability report, [the Taskforce on Climate-related Financial Disclosures] climate report and our online ESG data center with 250 metrics in it — it’s a lot of data. There’s a lot of stakeholder engagement across the enterprise. At the corporate level … we support them when they need it. We also work on issue-specific initiatives. I like to think of us as issue spotters, consistently monitoring the landscape for issues that could potentially impact AEP. We do materiality assessments engagement and monitoring of what’s going on. We have peer-to-peer networks in place to keep our finger on the pulse of what things could impact us. We work with our strategy team and executives.
Caroline Roan: Given the complexity of our business now, two days are never the same, which is what we love. A day in the life is focused [on] the broader concept of stakeholders. Our time should be spent listening to people outside of the company, so that includes engagement with multilateral organizations, society, policy makers [and] partners in investor relations to understand the investor perspective. A lot of my time is spent, as it should be, focused on understanding those perspectives and bringing those perspectives inside the company. Another part is making sure we translate those insights meaningfully to our business leaders and ensure we are getting everyone on board inside the company behind this agenda. At the heart, it’s really about growing your business responsibly. And then with the pandemic, everything changed. I played an outsize role on the access and affordability side of the house related to our Covid franchise.
Frost: Whom do you report to? Does this help you do your job?
Cruz: I report to our CEO, Dave MacLennan, and I am a member of Cargill’s executive team. Having a direct line to our CEO and being a member of Cargill’s executive team is crucial since sustainability is a business imperative for the company. The entire executive team understands the responsibility we all have to develop sustainable solutions for our customers. We are all accountable for advancing our own sustainability strategy, but are also committed to being a sustainable, reliable supplier, helping our customers achieve their climate goals as well.
Nessing: We do have a formal reporting structure in place. I report to the executive vice president and general counsel. The best practice and the best thing would be [reporting] to the CEO, but that is not common, not the norm. But legal is a good place for us, as David [Feinberg] is the corporate secretary. So that’s a direct line to the board, which is very important. I am still just two steps from the CEO.
Roan: I am an advocate for ensuring that the CSO is closely connected to leadership. I report in to our chief corporate affairs officer in the executive leadership team and they report in to the chairman and CEO. I think that the reporting [line] for the CSO role is absolutely critical. If you don’t have that visibility at a company the size of Pfizer, it makes it much harder to make sure you understand and are engaged in developing the business strategy.
Frost: Do you think face time with the board is important? How do you get this?
Cruz: Yes. Sustainability is not a new initiative for Cargill; it is an important element of our strategy and embedded in our global business. We report progress on our sustainability strategy and ESG goals to our board on an ongoing basis.
Nessing: I go before the governance committee at least twice a year, and that will be at least three times this year. I have a great relationship with that committee because they provide oversight of ESG and sustainability. There are good conversations happening there.
Roan: I do get a lot of face time with the board. In fact, I directly engage with the governance and sustainability committee as well as the entire board. This is absolutely critical for this type of work. Having access to the board and CEO ensures that you have the support you need to drive that enterprise-wide agenda.
Frost: How do you expect your role to evolve over the coming year or two?
Cruz: I’m looking forward to embedding sustainability even more deeply in how we do business and amplifying the positive impact we are working to deliver to our customers, the planet and the people in the communities we work. Looking ahead, we are committed to expanded transparency and reporting progress through our ESG scorecard and first-ever report this fall.
Nessing: ESG reporting is changing, and we are going to need to change with it. Customers are asking for emissions in real time, they want to know the electricity they are using is clean. We don’t know how to do that yet. Also, the expectations are higher when you think about lack of government presence in social issues. The expectations of companies is to fill that gap. We hear so many questions on social issues — the pandemic was the catalyst for that. The "E" and the "G" have always been in the front seat, and the "S" in the backseat. But now, all three are coming at us at the speed of light.
Roan: I do think it’s going to get more complex. There is a lot of interest from regulatory bodies in this space, particularly the "E." Because of that interest and demand from stakeholders and shareholders alike, the work itself will be more complex, and direct accountability to incorporate ESG as a part of the core business strategy will necessitate ensuring we bring even more people to the table that have that expertise and report it in a way that is meaningful to all stakeholders.
A Global Sustainability Head at a Recruiting Firm on the CSO Voice
Frost: Can you tell me about the new Global Head of Sustainability role at Egon Zehnder?
De Renzy Channer: The global head of sustainability role was created to ensure the work we do with clients globally is replicated within our firm. The climate crisis is, in fact, a leadership crisis. To advise organizations, we need to "walk the talk" and challenge ourselves to do better across our environmental footprint, social impact and governance. Therefore, this new role will entail creating a cohesive body of work across the firm and with our client work to drive the sustainability agenda forward.
Frost: Should CSOs report to the C-suite? The board? Why/why not?
De Renzy Channer: Context is everything! To decide the optimal reporting structure for a [CSO], leaders need to analyze the corporate and organizational context in which they operate. Whatever the setup may be, it’s critical to know that the CSO plays the vital role of a connector across the organization and must regularly interact both with the C-suite and the board — driving performance and incorporating both risk and opportunity thinking. But sustainability shouldn’t be one person’s responsibility. Intertwining sustainability and business goals is a major departure from traditional business models for many organizations and it will take commitment from the CEO to the board of directors to enact real change.
Frost: How can companies make sure the CSO voice is heard?
De Renzy Channer: The board and the CEO must be aligned to advance the sustainability agenda and set the tone from the top. When they embrace sustainability, this mindset quickly ripples throughout the organization. This means they will empower the CSO with the tools and resources to advance the agenda, signaling that sustainability will be incorporated into strategic thinking, decision-making, and the business model. The CSO’s voice is often that of a change agent and may be seen as challenging the organizational status quo. Organizations with strong corporate culture will need to ensure they evolve to invite, welcome and act on dissenting voices and new perspectives.
Frost: How might this role continue to change?
De Renzy Channer: The role combines both strategic-level ambition and pragmatic performance management. The CSO, as leader of a multi-functional and multi-disciplinary team, will expand the number of touch points across the organization and externally. They could increasingly play a role in helping the board understand the complexity of the stewardship challenge for board members (given the industry and organizational context) and more broadly work with the C-suite to integrate sustainability through the company purpose, ambition and metrics to be meaningful for team performance and behavior.