The Rise of the CSO – the business case for sustainability

The case for implementing sustainability in an organisation has become clear, and the pressure is mounting. Stakeholders and investors consistently demand added scrutiny to measure performance, but implementing a successful sustainability strategy can be challenging. 

As a result of this rising focus on sustainability, CSOs have become in high demand. Data from BoardEX suggests that over 27% of S&P 500 companies had a CSO in 2022, rising from 19% in 2017-2018. In 2021, more CSOs were hired than in the previous five years combined. A separate study found a 211% increase in client demand for sustainability hires between 2019 and 2022. 

The trend for sustainability professionals is likely to continue. Considering new directives and reporting regulations in Europe, industry experts expect a rising demand for CFO and finance services, executives with a direct influence and responsibility for sustainability and ESG plans.

Inevitably, the scale and extent of the role of a CSO is transforming. In previous years, CSOs typically operated separately from others, managing CSR measures but with less involvement with business leaders and the overall strategy. Today, the CSO represents a more strategic and high-priority position, someone likely to work closely with senior leadership, customers and investors, embedding sustainability into the overall corporate strategy.

While it’s positive to see sustainability move more into the spotlight, it creates additional challenges for leaders and hiring businesses. The CSO is a relatively new role, so there are fewer consistent factors and metrics to use as benchmarks. Some industry experts believe the role of the CSO is becoming ever more challenging.

Rising demands and emerging mandates for the CSO, along with multiple reporting lines make the duties of a CSO even more complicated. Studies suggest that only 30% of CSOs report directly to the CEO.

Today’s CSO will play a critical role. Rather than battling to be heard by executives and the leadership team, the CSOs now face the opposite challenge: managing the demands of multiple stakeholders. Traditionally, the sustainability team has been assessing and questioning the rest of an organisation. This has completely changed, and now the rest of the business is coming to CSOs for advice and support.

For the transition to be considered sustainable, executives must define the focus of their company as best as possible. They must be clear on which ESG targets to prioritise and ensure the reporting line for the CSO aligns with these goals to drive effective, sustainable action.