What is ESG and why is it important? Lessons learned and best practices with Dave Stangis

Summary

In this video, Dave Stangus discusses the evolving field of ESG (Environmental, Social, Governance) and its integration into business strategies. He emphasizes the importance of employee engagement, communication, and strategic alignment with sustainability goals. Drawing from his experience at companies like Intel and Campbell, Dave highlights how embedding ESG into company culture can drive long-term success and resilience. He encourages professionals to learn continuously, engage with others in the field, and listen to both leadership and employees to create impactful ESG programs that benefit the organization and its stakeholders.

Takeaways

• 😀 Employee engagement is crucial for driving sustainability strategies. At Campbell, 100% employee engagement in sustainability initiatives was a key goal.
• 😀 ESG rankings and sustainability lists can serve as valuable tools for continuous improvement within a company, though they should align with business needs.
• 😀 Focus on initiatives that provide value to the business, not just external recognition. ESG efforts should enhance company performance and innovation.
• 😀 Building relationships with ESG analysts and learning about the methodologies behind sustainability rankings can help companies improve their standing.
• 😀 A company’s culture plays a significant role in integrating ESG into operations. Sustainability must be embedded into hiring, training, and employee development processes.
• 😀 Sustainability goals should be hardwired into individual performance objectives, creating a flywheel effect of engagement and responsibility at all levels.
• 😀 The key to success in ESG initiatives is continuous learning and staying open to new ideas, as the field is constantly evolving.
• 😀 Listening to both leadership and employees is crucial in shaping ESG programs that are effective and aligned with company goals.
• 😀 Employee communications and engagement in sustainability initiatives can be challenging. Balancing involvement without overwhelming employees is a key aspect of success.
• 😀 There are many resources, organizations, and communities available for ESG professionals. Networking and engaging with others in the field can provide valuable insights and best practices.

Q & A

How does Dave Stangus view the role of ESG rankings in driving company performance?

Dave believes that ESG rankings, such as the Dow Jones Sustainability Index, are important tools for improving company performance. He views these rankings not just as a way to enhance a company's reputation but as a strategy to drive better innovation, product engagement, and employee performance.

What is the importance of employee engagement in sustainability initiatives, according to Dave?

Dave stresses that employee engagement is critical in building a successful sustainability strategy. He highlights how Campbell's goal of achieving 100% employee engagement in their sustainability strategy, by integrating ESG into performance objectives, created a culture where every employee was actively contributing to the company’s sustainability efforts.

How did Campbell successfully integrate ESG into its employee culture?

At Campbell, ESG was integrated into the company's culture by embedding it into new employee orientations, performance reviews, and incentive structures. This system ensured that all employees were aligned with the company's sustainability goals, with individual objectives directly tied to advancing sustainability initiatives.

What role does building relationships with ESG analysts play in improving a company's ESG performance?

Building relationships with ESG analysts helps companies understand the criteria used to evaluate them, which in turn allows for targeted improvements. Dave emphasized that engaging with analysts and learning their evaluation methods can give companies a strategic advantage in their ESG rankings.

Why does Dave recommend focusing on 'value-added' initiatives in ESG strategies?

Dave recommends focusing on value-added initiatives that directly help the company improve its operations and innovation, rather than just chasing external ESG rankings. By identifying ESG factors that can drive tangible benefits, companies can create lasting and meaningful improvements.

What are the challenges involved in employee communications around ESG, according to Dave?

Dave mentions that one of the biggest challenges in employee communications around ESG is ensuring that all employees are engaged without overwhelming them. Finding the right balance in frequency and content is key to maintaining an informed and motivated workforce.

How did Dave leverage ESG engagement to improve company culture at Intel?

At Intel, Dave focused on integrating ESG into the company’s processes from the start, even when the first carbon disclosure project had only seven questions. By engaging early with ESG initiatives and building systems around them, he helped foster a culture of sustainability within the company.

What strategies did Dave use to make ESG a part of employees' annual performance objectives at Campbell?

Dave implemented a system at Campbell where employees were required to include ESG-related goals in their annual performance objectives. This integration ensured that every employee, across various functions, contributed to the company’s sustainability goals.

Why does Dave emphasize continuous learning and engagement in the ESG field?

Dave highlights that ESG is a continuously evolving field. Professionals must stay updated on the latest trends, engage with experts, and continuously learn about their company’s operations to drive more effective sustainability initiatives and strategies.

What advice does Dave give to people just starting their ESG journey?

Dave advises those new to ESG to engage with relevant organizations, connect with peers, and keep learning. He emphasizes the importance of understanding the company's internal operations and listening to employees to create an ESG strategy that aligns with both corporate goals and employee needs.