Building Out Your Net-Zero Team
Just like safety, productivity and other key business imperatives, reaching your net-zero emissions goals won’t happen without a dedicated team pulling together, and the best way to deploy your human capital will look different depending on the nature and size of your organization.
When Michelle Tarry joined American Eagle Outfitters (AEO) in 2013, her work was on the social side of the company’s environmental, social and governance (ESG) program, with a focus on the working conditions, labor and human rights issues of workers at far-flung factories. Her current title—vice president for responsible sourcing and sustainability—didn’t exist.
Fast forward nine years: With customers, investors and other stakeholders focused like never before on addressing climate change, companies throughout the supply chain are being held accountable for slashing emissions of carbon dioxide (CO2) and other greenhouse gases (GHG)—and being asked to prove they’re doing it.
To do so, they’re creating new C-suite roles, adding staff and expertise through hiring and acquiring, and pulling together cross-functional teams across their operations to focus on specific aspects of their net-zero emissions-reduction strategies.
Since 2020, Tarry has nearly doubled her team to help AEO achieve aggressive sustainability goals that include becoming carbon-neutral in its own operations by 2030 and reducing emissions in its supply chain 40% by 2030 and 60% by 2040. Five AEO associates have the word “sustainability” in their title and an estimated 100 others are involved in working groups tasked with specific sustainability goals.
“Our focus on reducing the environmental impact of our business has been growing steadily, but just in the past few years the interest and commitment to sustainability has really accelerated,” Tarry said.
As with any kind of new initiative, the effort to implement net-zero emissions goals has resulted in a variety of approaches and spawned robust differences of opinion about the best way to deploy your human capital in service to those goals.
What does the optimal “net-zero team” look like? Do you really need a “chief sustainability officer,” and if you have one, who should they report to? Who on the team is leading the charge to bring your suppliers—by far the largest contributor to your carbon footprint—into the fold and help you meet your goals?
Teams, budgets on the rise
There’s no dispute that more companies are putting real resources behind carbon-reduction efforts. Sustainability experts feared the COVID-19 pandemic and resulting economic slowdown would hamper sustainability initiatives as the Great Recession of 2008-2009 did, but that didn’t happen.
“We’re finding bigger [sustainability]teams, more money for salaries and more support from senior leadership and at the board level,” said Ellen Weinreb, founder of Weinreb Group, a search firm that specializes in recruiting for executive sustainability positions.
According to results of a biennial survey published in the 2022 “State of the Profession” report from Weinreb Group in partnership with GreenBiz, the Global Reporting Initiative and the Environmental Defense Fund, corporate sustainability efforts have posted gains in several key metrics:
– Headcount: 76% of respondents reported an increase in the number of employees in sustainability roles, up 18 points from 58% in the 2019 survey.
– Spending: 74% increased their sustainability budgets, a 24-point increase from 2019.
– Leadership: 52% of companies surveyed now have a vice president or senior vice president in a dedicated full-time sustainability role, up from 38% in 2012.
– CEO engagement: On a scale of 1 to 7, 60% of companies rated their CEO at 6 or 7, with 20% considered “very engaged” and taking ownership of their company’s sustainability initiatives.
Half of the companies surveyed said they had hired at least one full-time sustainability position—with 30% adding two or more FTEs—since 2019 in response to investors’ insistence on greater ESG transparency. In addition, 35% said they added more external resources in the form of consultants.
A quick scan of recent job postings reveals companies actively recruiting for a variety of newfangled-sounding positions—an “associate logistics sustainability manager” at Unilever, a “global online sustainability manager” at Estee Lauder, and a “sustainability solutions strategist” at Dell Technologies.
While the survey group is skewed toward multibillion-dollar global companies and the results reflect their sustainability efforts, Weinreb said many smaller organizations facing similar pressures are adding their first dedicated sustainability headcount. MHI member AutoStore, which had 2021 revenues of $327 million and hired its first sustainability manager earlier this year, is a case in point.
Since going public in 2021, the Norwegian pioneer in cube storage automation has seen a rise in expectations for its net-zero efforts from investors, regulators, suppliers, business partners and even its own employees, according to Anette Matre, AutoStore’s chief people and information officer.
“I think the intensity of both the focus and attention [on sustainability]has increased very significantly the last year and a half,” Matre said. “Even if we hadn’t laid any plans of how to fully respond to this, all of these aspects would have forced us or any other company to do so.”
