Project Career Moves: ESG
Curiosity, adaptability and strong reporting skills will position you to work on projects that address environmental, social and governance issues.
Gone are the days when organizations can ignore purpose in the name of profits. Conscious consumerism calls for action around diversity and inclusion, and growing concerns about climate change are driving companies who want to thrive in the long-term to link what’s good for their bottom line with what’s good for the world.
The result is an ever-increasing demand for organizations to invest in environmental, social and governance (ESG) practices.
“ESG is growing throughout all organizations because the actual pressures on those organizations are increasing through consumers, through stakeholders and through investors from boards who determine what they need to be considering and how they need to be considering it,” said Alex Smith, co-founder and partner, The Sustainability Group, London, who are partnering with PMI.
According to KPMG’s 2022 Global CEO Outlook, 72% of CEO respondents believe that stakeholder scrutiny of ESG issues, such as gender equality and climate impacts, will continue to accelerate.
As the role of ESG grows, project managers have an important role to play, according to Mike Penrose, co-founder and partner, The Sustainability Group, London.
“Where we've seen ESG be most successful in companies is with the people responsible for the broadest perspective on what a company does, which is invariably the project managers,” he said. “They are the ones best positioned to say, ‘This is good, but I've identified that we could do it more sustainably here.’ Or, ‘I've identified that these suppliers are not particularly diverse.’ That is how we can work more within the framework of ESG.”
Alex Smith and Mike Penrose, co-founders and partners
The Sustainability Group
Here are three moves project professionals can make to build a career around ESG projects.
Start By Educating Yourself
The term ESG was originally coined in the early 2000s in a report commissioned by the United Nations that called for “better inclusion of environmental, social and corporate governance (ESG) factors in investment decisions.” However, it is understandable that many project professionals are not well versed or experienced in the practice, as only recently have many organizations begun to truly focus on their ESG efforts.
At the same time, the relative immaturity of ESG in the overall business landscape means that it lacks consistency and standardization from organization to organization, industry to industry and even country to country.
That means for many project professionals, the work begins by increasing your knowledge around ESG. Some of the best ways to do that include:
- Look for learning opportunities: There are many courses and webinars available on ESG and they can be a great place to start.
- Increase your foundational knowledge: Project professionals interested in ESG need to understand all three pillars — environmental, social and governance — of ESG and how they interconnect. It is an essential to designing a strong and impactful ESG program, otherwise you are simply engaging in box ticking exercise that ESG can sometimes be portrayed as, said Penrose.
- Identify a mentor: Conversations with ESG experts is one of the best ways to increase your knowledge and explore best practices, interesting ideas and ways that other people have gained experience.
Brace for Disruption and Disparity
As you pursue ESG opportunities, it’s important to understand that organizations and industries are adopting the practice at different rates, which may dictate the availability of opportunities.
“We are seeing certain areas grow more quickly than others,” said Smith. “There are places that have a greater maturity around ESG; for example, the financial centers of New York and London.”
In addition to varying levels of adoption, the looming threat of recession and economic struggles are driving some organizations to scale back their ESG efforts. In fact, according to the KPMG CEO Outlook report — which was released in October — as economic uncertainty continues, 50% of CEOs plan to pause or reconsider their existing or planned ESG efforts over the next six months, and 34% already have done so.
This can certainly have an impact on the availability of opportunities for project managers in the ESG realm. However, it also presents an opportunity for project managers who can bring ESG skills to the table to help their organization weather the storm while showcasing the value of ESG.
How can project managers do this?
- Look for incremental changes: Project managers can drive change by identifying individual changes that can improve every stage of a process, be it development, manufacturing or design.
- Identify long-term opportunities: Project managers are in a position to take a long-term perspective to a business’ growth and development. “Project managers have a huge role there in to being able to understand the potential opportunities for an organization to make it more resilient and more efficient in the long term,” said Penrose.
Hone Your Reporting Skills
More than 90% of S&P 500 companies now publish ESG reports in some form, according to the Global Accountability Institute, as do approximately 70% of Russell 1000 companies. The report also found that 69% of senior executives noted greater demand from stakeholders for increased reporting and transparency on ESG compared to 58% in 2021. This is compounded by increased skepticism from stakeholders around greenwashing and struggles with articulating a compelling ESG story.
What does this mean for project managers?
- They will need to understand what ESG reporting includes: “ESG reporting covers a broad range of topics,” said Penrose. “It’s about understanding the breadth of things that you think are possible, making sure that those outcomes have key KPIs behind them and making sure that you measure regularly as you would do with any project reporting.”
- They will need to look at how other companies are reporting on ESG: One of the best ways to learn about ESG reporting is to look at how other companies are handling and learn from that. Assess public disclosures from other companies and analyze their approaches and content.
Make Your Move in ESG
“ESG reporting covers a broad range of topics. It’s about understanding the breadth of things that you think are possible, making sure that those outcomes have key KPIs behind them and making sure that you measure regularly as you would do with any project reporting.”
—Mike Penrose, co-founder and partner, The Sustainability Group, London