Half of Board Members Report Lacking Skills to Address Climate Issues: WTW/Nasdaq Survey

Nearly half of board members report lacking skills and expertise in their organizations for addressing climate issues, even as most acknowledge that a strong ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. strategy can lead to better financial outcomes, according to a new survey by advisory, broking and solutions company WTW and the Nasdaq Center for Board Excellence.

For the study, the Fostering Corporate GovernanceGovernance deals with a company’s leadership, executive pay, audits, internal controls, and shareholder rights. and Enhancing Board Effectiveness Survey, WTW and Nasdaq surveyed 349 board members across 44 countries.

The survey found that most board members recognized value in sustainability-focused initiatives, with 75% of respondents agreeing that “a coherent environmentalEnvironmental criteria consider how a company performs as a steward of nature., socialSocial criteria examine how it manages relationships with employees, suppliers, customers, and the communities where it operates. and governanceGovernance deals with a company’s leadership, executive pay, audits, internal controls, and shareholder rights. (ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments.) strategy helps to create sustainable organizational value and stronger financial outcomes,” and “alignment with the organization’s business strategy” scoring as the most common factor influencing board members to prioritize ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. themes, cited by 85%.

Additional factors influencing the prioritizing of ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. factors included ethical reasons, by 78% of respondents, followed by long-term value creation, reputation and risk mitigation, while regulatory compliance placed only 6th, cited by 71%.

By ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. focus area, top priorities cited by respondents included human capital at 82% followed by governanceGovernance deals with a company’s leadership, executive pay, audits, internal controls, and shareholder rights. at 70%, while only half ranked environmentalEnvironmental criteria consider how a company performs as a steward of nature. and climate in their top-three priorities.

Despite acknowledging the value of a strong ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. strategy, many board members said that their organization’s don’t focus enough on sustainability issues, with fewer than two-thirds of (62%) of respondents agreeing that their boards have dedicated sufficient time and resources to governanceGovernance deals with a company’s leadership, executive pay, audits, internal controls, and shareholder rights. of their ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. priorities.

Similarly, board oversight of ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. issues appears to be evolving, with an expectation for more specialist responsibilities in the future. While more than half of respondents reported that oversight of ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. governanceGovernance deals with a company’s leadership, executive pay, audits, internal controls, and shareholder rights. is performed by a combination of the full board and other committees, 61% of these respondents also said that they expect to see a dedicated ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. or sustainability committee in the next three years, although 71% also acknowledged that some ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. oversight will continue to be a full board matter.

In addition to evolving oversight, boards also appear to expect to invest in ESG-related skills and education. While 48% of respondents reported lacking skills and expertise for addressing climate issues, only 18% expected this skills gap to remain in three years.

Kenneth Kuk, Senior Director, Work & Rewards at WTW said:

“Board members are evolving their ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. agenda from reacting to stakeholder pressure to proactively linking ESGEnvironmental, social, and governance (ESG) criteria are a set of standards for a company’s operations that socially conscious investors use to screen potential investments. to business strategy. As a result, we are seeing greater interest in addressing skills and resource gaps and more emphasis on oversight of emerging risks.”

Click here to access the study.

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The post Half of Board Members Report Lacking Skills to Address Climate Issues: WTW/Nasdaq Survey appeared first on ESG Today.