The ESG (Environmental, Social, Governance) framework and the CSRD (EU Corporate Sustainability Reporting Directive) call on companies to make their sustainability performance transparent - companies must rethink their business practices to achieve environmental, social, and governance goals while meeting the expectations of investors, customers, and regulatory authorities.
The ESG Practice and BDO Belgium conducted a study surveying around 150 companies across 13 European countries to gain insights into companies’ attitudes towards the integration of ESG factors, the obstacles they face and their main drivers.
Three key factors have been identified as ensuring the success of a company’s transition to sustainability and highlight the critical role attributed to leaders in this context:
These topics are naturally close to the core of how we serve our clients every day within our ESG expert team and beyond. Research clearly shows that effective leadership has the biggest impact on results, hence leadership is instrumental for succeeding in the transformation of sustainability and the journey towards a regenerative model.
“The integration of ESG cannot occur in isolation; it requires a cultural shift within the company. This directly raises the question: Do our leaders have a sustainable mindset and the right leadership attributes to navigate the transformation?” - (Dr. Anja Behrens, Partner & ESG Practice Expert)
In this context, leaders must be equipped with the right mindset, necessary skills and knowledge to foster a culture of sustainability, to be able to identify ESG risks and opportunities, set measurable targets and KPIs, and engage employees in driving continuous improvement and innovation.
“The ESG path proves to be a value-adding yet complex management task: the selection and development of leaders in alignment with their company’s strategy, context, situation, and objectives, will be key to ensure success of company’s efforts to drive such transformation.“ - (Isabella Valentini, Group Director, ESG Practice Expert and Inclusion & Diversity Lead)
Summarising the results and translating them into practical advice, the report gives exciting insights into obstacles, drivers and success factors towards sustainability transition.
As a valuable outcome, the study suggests a roadmap of actionable recommendations for companies to move forward in their ESG journey, enabling businesses to create long-term value for all stakeholders.