The death of the ESG Committee | Vicky Moffatt, CEO Chapter Zero
Climate change is not just a distant threat, but an urgent and immediate reality that is forcing fundamental change for organisations, often transforming their business models. The role of governance in enabling and guiding the urgent transition to the net zero economy has never been more crucial.
In this podcast, Dr Sabine Dembkowski, Founder and Managing Partner of Better Boards) discusses how Chairs can structure their committees, why climate change is central to business resilience and growth, and the role of the board with Vicky Moffatt. Vicky is CEO of Chapter Zero, the Director’s Climate Forum, a global membership organisation for Non-Executive Directors and Chairs.
"Every director needs to understand that over the longer term, there are only two scenarios for the transition and our global economies”
Vicky sees boards at every stage of the climate journey. Her work is about educating members to be effective climate leaders from the boardroom. To her, climate is not just a governance issue but a call to action that should be addressed at every level of the organisational structure. Segregating climate issues into an ESG committee is an ineffective approach. Instead, it is the directors' responsibility to take the lead in designing and executing the clean energy transition, thereby making a significant impact on the future of our planet.
“I think the longer-term nature of the net zero transition makes it fall in perfect alignment with the very role of the board itself”
To Vicky, the corporate governance code promotes the long-term, sustainable success of the company, generates value for shareholders, and contributes to wider society. Leaning on that definition makes board work and net zero perfect bedfellows. So, it's not about the individual director at all; it's about shifting the very culture of the boardroom itself.
“The further you go, the more you realise climate and sustainability are issues for every board committee and indeed for the whole board”
ESG committees can be hugely important in driving change around business models and strategies, but the issues of climate and sustainability impact so much that the whole board needs to be involved.
“There is a sense that this work is too difficult”
Vicky points out that when it comes to climate and climate transition, fundamental, systemic change is needed. It can feel overwhelming and intimidating, and there’s a lot of unfamiliar territory. So, everyone needs to be comfortable with being in a mode and mindset of learning rather than giving in to the overwhelming aspects.
“Great work is happening out there”
Vicky shares some concrete examples of great work in the podcast episode.
“The chair is crucial. But in some of the more progressive boards that I've seen, the chair is sort of like the goat herder, leading from behind”
Vicky feels that when it comes to climate, it really is conventional change work, even though the Net Zero agenda is the most extraordinary change programme ever written. With all excellent change work, it is about having a powerful guiding coalition with a clear vision. Chairs lead this, sponsor this, and enable this, but the best chairs create the space for their teams to carry the work forward.
The three top takeaways for effective boards are:
1. There are only two scenarios – invest in the clean economy or experience runaway climate change.
2. A good transition plan is linked to good governance and must be led by the board.
3. Climate change is an issue for the FULL board.
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