CIOs must lay a solid technology foundation for ESG initiatives

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Solar panels and windmill

With enterprise data at the heart of companies’ environmental, social and governance (ESG) strategies, CIOs are well positioned to play a key role in advancing ESG objectives, while helping to orchestrate the requisite culture change.

We asked the CIO Influencer Network, a community of B2B technology experts and thought leaders, about the role the CIO should play in their company’s ESG strategy. Most agreed that the CIO’s front-row seat to digital transformation intersects with nearly every facet of the business. Their role provides a strong vantage point for moving the needle on ESG metrics and marshalling the enterprise around cornerstone issues involving sustainability, diversity and inclusion, and corporate governance.

“Whether it’s tying into new data sources, whipping up a new mobile application to help collect better data or offering new ways of governance within your organization, CIOs are in the captain’s chair and it’s incumbent on them to bring ideas and solutions to bear,” says Aaron Miri (@AaronMiri), senior vice president, chief digital and information officer at Baptist Health.

It’s incumbent upon the CIO to make innovation decisions and direct technology purchases with sustainability considerations in mind, given that the IT estate has a significant impact on a company’s carbon and environmental footprint, according to Linda Grasso (@LindaGrass0), CEO of DeltalogiX.

“Innovating responsibly” involves defining the guidelines for a strategic sustainability plan that aligns ESG criteria with a digital approach, says Grasso.

The ongoing pandemic has showcased the power of unanticipated events, heightening the global imperative for advancing ESG. “The best way to manage these risks and lessen their impact is to have a system of ESG metrics in place for early identification and action,” says Helen Yu (@YuHelenYu) , founder and CEO of Tigon Advisory Group. “The CIO plays a critical role in selecting and adopting a system of ESG.”

An ESG roadmap

One of the biggest ways CIOs can impact the ESG agenda is through data, which is already a top initiative at most enterprises. ESG is highly dependent on collecting, managing and sharing the right information to understand the current state and what needs to be done to hit critical ESG-related metrics. Under the CIO’s direction, a good ESG data strategy will inform the C-suite and board of their organization’s environmental impact in terms of energy usage in data centers and business processes; provide insights for optimizing hardware and software purchases and managing technology lifecycles; and put forth governance policies that promote data trust and transparency.

In addition, the CIO should be a focal point for sharing the goals and objectives of an organization’s ESG development, along with others in the leadership suite. CIOs can play a key role in identifying data and establishing analytics initiatives that inform long-term planning for economical use of resources, increased labor productivity and efficient uptime of digital services, says Nikolay Ganyushkin, CEO and founder of Acure.io.

“CIOs should be collaborating with other executives to understand company-wide resource consumption, supplier/vendor/partner supply chains, cloud provider risks, and remote work impacts,” says technology advisor Arsalan Khan (@ArsalanAKhan). “They can also identify systems to capture fraud, assess diversity pipelines and check biases in hiring practices.”

Influencers offered additional ways that CIOs can help their organization meet ESG objectives:

  • Raise consciousness levels. “ESG criteria must have a strong technology backbone,” says Frank Cutitta (@fcutitta), CEO and founder of HealthTech Decisions Lab. “This requires a CIO who can empower innovative technology solutions that enhance social and environmental consciousness in the eyes of their various stakeholders.”
  • Identify the right KPIs. “There are numerous sustainability initiatives the CIO can proactively support in pursuing enterprise goals,” says Gene De Libero (@GeneDeLibero), principal of Digital Mindshare LLC. “The first step is to determine the KPIs available to measure ESG performance before making any investments.”
  • Help drive culture change. It’s critical for CIOs to partner with the business and executive team to define ESG goals and programs. “A CIO who’s been conscientious about building relationships with business stakeholders is in an even better position to play a lead role in an ESG strategy because of the influence they hold over other key stakeholders and employees,” says Will Kelly (@willkelly), a product and content marketing manager focused on DevOps and the cloud.
  • Lead by example. “There are opportunities to give back to communities or to reduce energy consumption in the technology stack,” says Isaac Sacolick (@nyike), president of StarCIO and a digital transformation leader and influencer. Carlos Melendez (@cm_melendez), chief operating officer of Wovenware, emphasizes that part of the CIO’s role is to ensure that every technology roadmap considers environmental impact. “For example, data centers can be structured to minimize cooling and energy costs or better yet, a shift to the cloud can eliminate energy-sucking data centers altogether,” Melendez says. “Additionally, modern IT systems are designed to be more energy efficient than legacy systems, which can help companies reach their ESG goals more quickly.”
  • Develop realistic and transparent ESG goals. “Media headlines play an important role in any company’s perceived value to the environment, society and its respective industry,” says Scott Schober (@ScottBVS), president and CEO of Berkeley Varitronics Systems Inc. “CIOs must be nimble in shielding their corporate overlords, while at the same time putting their company’s best foot forward to truly convince others that their company’s ESG strategy is a net positive for the planet.”
  • Don’t forget the “S” in ESG. CIOs can help deliver against their organization’s diversity and inclusion agenda by taking a fresh look at their own teams. “Most IT organizations are largely homogenous,” says Lior Keet, Managing Director, Emerging Technology, ESG, Ernst & Young, LLP. “IT is not traditionally a career path for minorities. CIOs need to sponsor key initiatives that drive diversity and expand traditional outreach to IT talent.”

As ESG efforts gain prominence at the C-suite level and become a key differentiator for consumers and employees alike, CIOs have an opportunity to shine. But there are consequences for those who opt to take a back seat. “Make no mistake about it,” warns Baptist Health’s Miri. “If you are unwilling or incapable to be at the table, then your board of directors will find someone who will.”

Learn more about how organizations are leveraging technology to embark on their ESG journeys.