HR’s role in aligning a people and sustainability strategy

"HR leaders have a crucial opportunity to be change-makers", said Hult International Business School's sustainability lab director

HR leaders have a crucial role in helping businesses develop and implement ambitious ESG goals.

More and more organisations are writing sustainability and ESG goals into the heart of their corporate strategies.

Take Unilever for example. One of the four pillars of its ‘Compass’ strategy is 'Win with our brands as a force for good, powered by purpose and innovation'. Sitting behind this strategic objective are well over 30 specific targets spread across the health of the planet, people’s health and wellbeing, and a fairer and more socially-inclusive world.

As a growing number of companies start putting goals like this at the heart of their strategies, they are having to work out the implications for all the different areas of the business, and HR is no exception. So what does this mean for HR practitioners and the company’s people strategy?

Read more: HR Most Influential’s top priorities: sustainability, ESG and achieving net zero

At Hult we’ve been partnering with the Corporate Research Forum, among others, to explore exactly this question. What has emerged is the need to look at those areas that tend to be directly owned by HR, as well as others where HR has a core role in helping other parts of the organisation achieve their goals.

Areas that fall directly into the sphere of HR might typically include safety at work, employee wellbeing, and equity, diversity and inclusion. But when it comes to helping organisations achieve their wider sustainability goals, perhaps the profession’s most important role is helping build the knowledge, skills and mindset needed to support the focus on sustainability.

Read more: How can businesses become more sustainable?

A recent study conducted by Russell Reynolds Associates, in partnership with the UN Global Compact, found that 92% of business leaders believe that integration of sustainability issues is critical to business success, but only 4% of C-suite role specifications demand sustainability experience or mindsets.

HR leaders have a crucial opportunity to be change-makers for their organisation. They can act as advocates for the business to develop ambitious ESG goals, and to integrate these into their business and people strategies.

Read more: How the climate crisis is transforming HR

These are some key questions HR practitioners need to consider:

  • Does your organisation address sustainability, net zero and ESG issues as part of its strategy? As an HR leader, what are your opportunities to be an advocate for this?

  • Is your organisation’s people strategy aligned with ESG goals?

  • Are board members and senior leaders across your organisation equipped with the knowledge, skills and mindsets to bring action on sustainability into the forefront of their day-to-day work?

  • Are you taking steps to proactively build the knowledge, skills and mindsets for action on sustainability into leadership development, and also learning and development for core functions such as sales, sourcing and finance?

  • Are you considering relevant knowledge, skills and mindsets for sustainability when crafting role descriptions, and then actively looking for these when recruiting and selecting?

  • Have you reviewed your approach to performance and reward, looking to ensure that incentives are aligned with sustainability goals? Too often, people want to take action on sustainability, but lose out on incentives if they do.

  • Are the benefits offered to employees aligned with advancing ESG goals?

  • How proactively are you thinking about your role as an HR leader in influencing the organisation’s culture and norms around ESG? How can you draw on your OD expertise to launch initiatives that help shift underlying norms and assumptions around sustainability? Examples might be creating networks of sustainability champions, or setting up innovation challenges with a sustainability angle.

  • Have you mapped out the implications of these various roles for HR across different members of the HR team and their different areas of responsibility?

Culture famously eats strategy for breakfast. HR practitioners have a crucial role in helping create the cultural environment in their organisations where the company’s strategies on sustainability and ESG can thrive.

By Matt Gitsham, director of the sustainability research lab at Hult International Business School