The importance of ESG for interim managers & freelancers
Original content provided by BDO Belgium.How sustainability gives you an advantage
Not a day goes by without at least one article appearing on ESG. Is ESG a hype? Is it simply ‘the latest craze’ to distract policymakers (and consultants) - ? If you’re not already up to speed, it’s time to brush up on your knowledge because ESG is much more than a hot topic. For many companies, it has already become a ‘licence to operate’.
Sustainability is now an integral and irreversible element of business operations. New regulations, financing, client and employee perceptions and expectations... the impact sustainability has on the business world is very real today.
When thinking about sustainability, don’t just consider the ecological aspect (Environmental). Social relevance (Social) and good corporate governance (Governance) are also crucial pillars for future-proof organisations.
This means that as a freelancer or interim manager, you’ll undoubtedly be confronted with the responsibilities, challenges and opportunities of ESG. What impact does this have on organisations and how do you optimise your role as an external party in this challenge?
From risk to reward
As already mentioned, every company will have to deal with ESG. Currently, most large companies have already started taking action to meet the obligations arising from the EU Green Deal, in particular the now-mandatory ESG reporting (CSRD) for European entities and others.
For many, the whole ESG and CSRD topic can be reduced to a matter of compliance. In doing so, they sell themselves short because they fail to see the new opportunities offered by this latest legislation. Being transparent about sustainability ensures that companies remain vigilant and are not caught greenwashing. And it avoids all kinds of scandals – such as those involving toxic leadership or a lack of equal opportunities - so positive public perception is maintained. In addition, corporate sustainability is an important catalyst in stimulating innovation.
“As a freelancer or interim manager, you’ll undoubtedly be confronted with the responsibilities, challenges and opportunities of ESG."
STEVEN CORNAND
Head of Interim Management BDO Belgium
ESG in business: a never-ending story?
ESG matters are mainly the responsibility of the top layer of the company: management. From now on, integrating ESG is one of their direct responsibilities. For a CEO or CFO, this means that sustainability plays a role in decision-making. HR focuses on inclusion and wellbeing, while supply chain or procurement is responsible for sustainable and responsible purchasing.
So how does a company meet all its ESG requirements? By integrating the three pillars into strategy, adjusting policy making and adapting the business. And that takes time, effort and knowledge. It’s a challenge, especially given that for many executives it is still uncharted territory. During this transition, it is important to avoid an information overload and keep things in perspective, despite all the novelties ESG brings.
The role of interim managers and freelancers
When we talk about the impact of ESG on interim managers, we distinguish between two different roles.On the one hand, as an interim manager, you might take on an assignment as part of the executive team in a company in full transition. This means you are partly responsible for the company’s ESG goals. On the other hand, there are interim managers who take on a project-based role, using their knowledge and sector expertise to guide their clients through the implementation.
How BDO can help
Companies are confronted with a lot of extra work in a relatively new field. As an organisation actively working on both its own ESG objectives and advising our clients on the matter, at BDO we know this is no easy task.
For both companies and interim managers, the solution lies in combining expertise.
Contact your local firm’s specialists to learn more about how BDO assists companies in their ESG transition and / or our interim management solutions.