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Sustainability
Leading the sustainability conversation
Terri Bloore on why sustainability has moved from the CSR team to the finance director’ s office
For many years, sustainability sat within corporate responsibility teams, communications functions or specialist environmental departments. While these teams played an important role in raising awareness and developing early strategies, the conversation taking place in many boardrooms today is noticeably different. Increasingly, the most influential voices in discussions around sustainability are not sustainability directors but chief financial officers.
Value creation
This shift became particularly apparent during London Climate Action Week, where I moderated a discussion examining the role of the CFO in driving sustainable growth. Although the organisations represented varied considerably, the issues being discussed were remarkably consistent. Financial leaders are increasingly approaching sustainability through the lens of risk, resilience, investment and long-term value creation.
Uncertainty
The economic environment facing organisations has become considerably more complex over recent years. Businesses have had to contend with volatile energy prices, supply chain disruption, inflationary pressures and geopolitical uncertainty. Against this backdrop, sustainability is increasingly being viewed not as a separate agenda, but as part of broader discussions about resilience and competitiveness.
For many finance directors, the starting point is not carbon reduction
targets or reporting frameworks. The questions are often more practical. How exposed is the business to energy price volatility? What risks exist within the supply chain? Will investment in energy efficiency reduce operating costs? Does stronger sustainability performance improve access to capital or strengthen relationships with investors and customers?
These are familiar questions for any finance function because they concern the management of risk and the allocation of capital.
Businesses have always invested to improve productivity, reduce costs and protect future earnings. Increasingly, sustainability-related investments are being assessed in exactly the same way. Energy efficiency programmes, building improvements, resilient supply chains and new technologies are no longer viewed solely as environmental initiatives. They are being evaluated in terms of payback periods, operational savings, risk reduction and long-term value.
Changing environment
Financial markets have also evolved. Investors and lenders are increasingly interested in how organisations manage long-term risks, including those associated with energy, climate and supply chains. Customers and employees similarly expect businesses to demonstrate that they understand the changing environment in which they operate.
For many smaller businesses, the language surrounding sustainability can still feel remote or overly technical. However, when discussions focus on energy costs, operational resilience, productivity and competitiveness, the relevance becomes much clearer. The decisions involved often require capital investment, making the finance function central to determining priorities and assessing returns.
Expertise
London remains one of the world’ s leading centres for sustainable finance and investment, providing businesses with access to expertise across financial services, professional services and innovation. However, investment requires confidence, and businesses need stable policy environments and long-term certainty when making decisions.
One of the most encouraging developments in recent years has been the growing recognition that sustainability, resilience and growth are closely connected. Organisations that understand their risks, invest in efficiency and plan for the long term are often better positioned to compete and grow.
The question facing many businesses is no longer whether sustainability belongs in the boardroom. Increasingly, it is whether the finance director is leading the conversation.
Terri Bloore is deputy chair of LCCI sustainability committee and managing partner, corporate and financial services, at FINN Partners
www. finnpartners. uk