How to harness the power of your people for sustainable transformation

Renée de Boo, Partner, People & Change, KPMG in the Netherlands

What does it take to transform a conventional business into a sustainable business; one that is in shape to succeed in the changing world of today and tomorrow?

Hundreds, if not thousands, of ‘experts’, including academics and consultants, have addressed this question.

Many agree that you need a clear vision of where to take your organization and why. Moreover, that you need a roadmap of actions to get there, robust environmental, social and governance (ESG) policies and processes, and that you need advanced IT systems and data.

But there is an additional piece of the puzzle that is essential to the success of your sustainable transformation: an ESG-aligned company culture. If your people are on board, their collective energy can rocket boost your ESG efforts, taking your company further and faster towards your sustainable transformation goals than you thought possible. If they are not behind you, then you risk moving slowly or even getting nowhere.

So how do you harness the power of your people towards a sustainable transformation?

First of all, make it clear. It is critical that your company’s leadership is aligned on the strategic aims of your sustainable transformation, as well as on the ambition and scale of change required. Leadership is paramount when shaping culture change of any kind, and it is no different when it comes to aligning corporate culture with sustainability.

Your CEO can play a central role in bringing leadership together behind the company’s ESG direction. It is no accident that many of the companies best known for strong ESG progress are those where the CEO has been closely involved in creating the guiding vision.

Secondly, make it known. Communicate, communicate, then communicate some more. Your people need to know why the company is embarking on a sustainable transformation in the first place and what that future looks like. How will the new, sustainable business be different from the way it is today?

Your people are all professionals in their own spheres with an interest in the long-term success of the company.  So it is important to explain how and why a more sustainable business is also a healthier and more successful one. And why drivers like new regulations, customer demands and shifts in the market landscape mean that change is needed.

Key to success is to build a coalition of ESG ambassadors across all functions in the organization. Sustainable transformation can be accelerated dramatically if you invest in the people who are willing to change and have the capacity to do it.

Next, make it real. Bold environmental and social goals can be inspiring, but the big vision of change must be translated into people’s personal reality. You can expect almost everyone to be in favor of better impacts on people and the planet, but how will that affect their own roles on a day-to-day level? Whether they work in HR or IT, procurement or finance, what will their jobs look like once ESG has been integrated into their roles?

Then it is time to make it happen. Sustainable transformation adds a new dimension to the way everyone in the organization works. Financial performance used to be all that mattered. Now, non-financial or ESG performance is becoming equally important. So you need to equip your people to work in new ways with the right knowledge and skills to flourish. It is also about having effective systems and structures in place to monitor ESG performance and progress.

Finally, make it stick. Sustainable transformation is an open-ended process of continuous improvement and iterative change. Long-term investment in sustainability learning and development is crucial to make sure you can sustain change in the organization over time. It is also important to integrate ESG into your compensation and incentive systems, to reward people for achieving their ESG goals and to celebrate their successes.

Every organization is different and each operates within its own distinct culture which has often developed over decades. Some companies value the stability of tried-and-tested rules and processes. Others encourage experimentation and risk-taking. Some promote competition and reward individual excellence. Others put emphasis on group success, teamwork and collaboration. For some, fun and enjoyment on the job are a priority, while other cultures place more emphasis on laser-focused achievement of results.

Whatever your company culture may be, its power can be harnessed to drive your organization forward in its sustainable transformation. The key to success is to ensure that company culture is front and center in your transformation plans and not left to the sidelines.

Improve your understanding of your company’s ESG strengths and weaknesses by taking KPMG’s ESG Health Check.