How can boards integrate sustainability into their oversight tasks?

Here’s a note from Andreas Rasche:

How can boards integrate sustainability into their oversight tasks? I have collected some important lessons on how to build a “board sustainability infrastructure” and put them into a new paper. The focus is on (1) the structure boards choose to discuss sustainability, (2) directors’ collective mindset vis-a-vis sustainability, and (3) the development of relevant competencies.

1. STRUCTURE: Should boards form a sustainability committee, or should the entire board integrate sustainability discussions? There is no one-best-way, but there are situations and contextual conditions that impact whether a structural model fits better or not.

2. MINDSET: Maybe more important than structure is how boards approach sustainability discussions. Which beliefs and assumptions shape the debate around ESG topics? Too often, a compliance mindset dominates (e.g. because the link between new regulations and strategic thinking is not yet obvious).

3. COMPETENCIES: Research shows that boards are still lacking sustainability credentials and relevant expertise. While directors do not need expert sustainability knowledge, they need to build up knowledge in various interrelated areas to fulfil their tasks.

Much more can be said, but these three areas are a good way to start the discussion…