Here are nine tips on how to establish a Sustainability Advisory Council that will enhance your business's bottom line.
By Alice Korngold
Part of the A Better World, Inc. series
A number of leading companies are beginning to realize they can profit by finding solutions to the world’s most daunting economic, social and environmental challenges. These multinational corporations have the resources, global footprint and profit motivation to be more successful in solving major global problems than national governments, the international community or even the NGO sector.
My research for A Better World, Inc.: How Companies Profit by Solving Global Problems…Where Governments Cannot revealed that in order to succeed in global problem-solving, companies are engaging with variety of stakeholders on how their decisions will have economic, social and environmental impacts. Additionally, some of these corporations are benefiting by convening Sustainability Advisory Councils (SACs) with experts who provide advice regarding new products, services, strategies and reporting.
These companies feature in A Better World, Inc., and practice a variety of approaches with regard to composition, frequency and duration of meetings, agendas, and even compensation. Culled from my research and advisory experience, here are top recommendations for establishing or enhancing your company’s SAC as you pursue your sustainability path:
1. Establish its Role
Establish the SAC’s clear role and purpose based on your corporate mission, vision and plans for growth. SACs are advisory, never governing, bodies. An SAC’s role is to provide expert advice to the company’s management regarding sustainability matters that are integral to corporate growth.
2. Set Expectations
Based on the SAC’s purpose, create a job description or statement of expectations you can provide to individuals whom you seek to recruit to the SAC.
3. The Ideal Composition
Determine the ideal composition for the SAC. Consider the best mix of people, including diversity of expertise, experience, geographies, gender, backgrounds and perspectives. SACs often include people from the investment sector, as well as experts in economic, social and environmental challenges facing the world.
4. Set a Calendar of Meetings
Set the number and duration of meetings that will be required to accomplish the SAC’s purpose. Some SACs meet for a mere two hours a year, while others meet for two to three days semi-annually. Companies whose SACs meet for longer periods and more often seem to derive greater value from the experts who serve. Rotating SAC meetings among various manufacturing sites also seems to be useful to companies in orienting SAC members to the business.
5. Set Agendas
Create thoughtful and purposeful agendas based on the role of the SAC and the company’s strategic challenges and opportunities.
6. Be Clear about Executive Participation
The chief sustainability officer is usually the lead person at the company who works with the SAC. Some companies alternate the management teams who participate in each SAC meeting depending on the strategic issue under discussion. Companies that take the SACs most seriously seem to involve the CEO in at least one SAC meeting annually. At one company, the CEO meets with just a few members of the SAC at a time for unfiltered, candid and confidential conversations about the future of the business.
There is a range of compensation for members of SACs. Some companies provide no compensation, while others provide modest five-figure annual stipends. The trend seems to be moving toward compensation based on average daily consulting fees to cover an SAC member’s time for meetings, preparation and follow up.
8. Assess the Value
Evaluate the value of the SAC at least bi-annually. Update its purpose, composition, agenda and practices as needed in order to maximize the benefit and opportunities of having a company SAC.
9. Recognize the Experts
Recognize and appreciate the time and contributions of SAC members, not only with thank you’s from the CEO, but also with thoughtful planning and arrangements for SAC meetings.
SACs provide companies with insights and expertise from a variety of perspectives about the company’s social and environmental impacts. This advice regarding ongoing operations, new investments in sites, products and services, and reporting can help add to a company’s bottom line. Through discussions with their SACs, companies can recognize risks as well as new opportunities through solving global problems. It’s a classic win-win but only if you prioritize global problem solving in your business plan as a way of pursuing sustainable growth.
Next week: How to leverage corporate-NGO partnerships for global problem solving.