The focus of the sustainability function is changing from commitments and reporting to leading business through uncertainty. David Carlin shows how sustainability teams are managing that change.
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In his digest series Ask David, David Carlin explores the challenges sustainability teams face today, giving actionable advice on demonstrating financial value, strengthening business strategy, managing risk, and driving real organizational impact.
Over the past few years, the environment for corporate sustainability has changed massively. Political winds have shifted, geopolitical tensions have moved energy security and supply chains up the agenda, and organizations are under pressure to demonstrate the value of their sustainability activities.
So where does this leave the sustainability function? I discuss how its role is changing and what sustainability leaders need to do next.
Many sustainability functions were built around commitments and reporting. Is that model still fit for purpose?
A lot of sustainability functions were set up or significantly expanded around 2021 and 2022. At the time, the focus was very much on making commitments, developing plans, and reporting on progress.
I do not think firms have simply abandoned their commitments. What has changed is the context around them and, as a result, the purpose of the sustainability function.
The 2024 US election was one important factor. We have also had major geopolitical conflicts, particularly in the Middle East, which have brought renewed attention to energy security, inflation, and supply-chain resilience. At the same time, there is a growing recognition that we are increasingly out of step with our climate goals.
Yet the transition continues to accelerate. New technologies are scaling, investment is continuing, customer expectations are changing, and companies are having to respond to physical risks and shifts in competitiveness.
That creates a much more complicated environment for sustainability leaders. Their role cannot be limited to asking whether the organization is meeting a commitment or producing the required report. They need to help the organization understand what is changing, why it matters, and what it should do about it.
Continue reading this insight on David Carlin's Substack and visit D. A. Carlin & Company for more information.
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