Climate Governance Initiative: recordings from the Global Summit
Climate Governance Initiative has brought together insights, expertise, and experience from more than 125 Non-Executive Directors (and other eminent speakers from around the world). Their Global Summit 2022 website is a fantastic resource, featuring recordings of sessions from this excellent conference:
As more businesses signal readiness to develop robust climate plans, how can boards guide their companies to turn ambition into action? The event program featured 28 sessions, over a 24-hour long virtual global conference: region-specific keynotes, panels, and interactive sessions developed and delivered by the CGI’s network of NEDs, targeted at board members and directors from the business world who are ready to take effective climate governance to the next level…
Ambition to Action: Keynote Conversation 1
Climate action (mitigation and adaptation) plus ESG need to be integral with corporate strategy. NEDs should be focused on maximising long-term value and optimising the long-term interests of stakeholders, not just the short-term financial interests of shareholders. Resilience.org projects that the consumption of natural resources will increase from 92-101 billion tonnes per annum at present to 170-184 billion tonnes of materials per annum by 2050, with a typical person consuming 12-18 tonnes of natural resources each year:
Zero ambitions: what is the role of boards on climate??
The role for boards includes gathering information, considering strategic targets, communication and leadership, as well as oversight of strategic risks and the significant opportunities. Specific Directors for climate (or cybersecurity or risk) are not required, because every Director needs to upskill and take more responsibility for climate governance. Board committees covering risk, audit, and sustainability have limited bandwidth, their work does not replace the overall board accountability. Big emphasis on moving from intent to action. Long-term ambition must be complemented by interim targets, granular plans, and cost estimates:
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Strategic Integration of Sustainability – Accelerated by Engaged and Active Owners
Active and engaged owners ensure that their companies work with both the risks and the opportunities related to climate change (together with other sustainability issues). A key success factor is stakeholder dialogue and engagement. Good examples of disclosure and execution from European family companies, such as the quantification of True Value Creation (after factoring in ESG externality estimates). Includes a fascinating 10-minute presentation on the incorporation of sustainability into corporate governance, by Morten Bennedsen (Visiting Professor, Wendel International Centre for Family Enterprise, INSEAD; Professor of Economics, University of Copenhagen):
Ambition to Action: Keynote Conversation 3
Board agendas are getting more crowded and more complex, while still having to deal with strategy/risk/culture as part of business-as-usual. Emphasis on Audit Committees, from both risk/protection perspective as well as strategy/value perspective. Advocacy for broad-based price on carbon emissions, to equalise the economic playing field globally:
Climate and people: putting passion into board practice
The whole board has to be able to engage in governance decisions, not just delegating to sustainability/ESG committees. All of the individuals involved in the Climate Governance Initiative have personal stories and emotional resonance that energise their motivation to make a positive difference:
Ambition to Action: Global Summit 2022 Closing Remarks
Boards have a key role for driving sustainability outcomes, but should focus on material issues of strategic importance. Regulation such as the European Green Deal plays a key role. Some aspects of climate, sustainability, and ESG should be holistically integrated into company strategy. Prompted Non-Executive Directors to convert ideas/discussions into action, while considering the main risks and opportunities: