How to design your ESG communications strategy

In the world of corporate communications, ‘ESG' is the buzzword of the moment. It encompasses the environmental, social and governance values and impacts of an organisation, which is under constant and growing scrutiny from customers, employees, investors and stakeholders alike.

"The reason ESG is really big at the moment is because the Greta Thunberg showed up and really highlighted the ‘E' aspects of ESG, then COVID hit and that's where the ‘Me Too' and BLM movements started highlighting the ‘S' and ‘G'," says award-winning communication specialist Gihan Hyde. "It is really sexy at the moment and it's important organisations get on board or they'll fall behind."

As founder of CommUnique, a B-Corp-certified ESG communications consultancy, Gihan helps organisations to integrate ESG initiatives into their business models. Her team also helps clients - ranging from large FTSE 100 companies to growing tech and fintech companies - to communicate these initiatives in a way that would resonate with their audience. Prior to founding CommUnique, Gihan worked in communications with companies including Barclays, HSBC, M&S and BP. "ESG has always been part of my work and my DNA before I realised what ‘ESG' was," adds Gihan, who is also the lead on the CIPR's new ESG courses.

THE ROAD TO SUCCESS
Gihan believes that having a solid ESG communications strategy is vital to a company's success, especially in the current climate. "An ESG communication strategy is basically a road map that tells you which roads not to take and which roads to take," she says.

"The strategy should be integrated within the Business as Usual (BAU) strategy but it should be handled in a different way because it's the ‘North Star' that will direct the company to grow. Profit is no longer going to be key to growth - people and prosperity are going to be integrated into growth."

An ESG strategy differs from a BAU strategy because it's not about growth, it's about changing mindsets, she adds. "Previously, we just wanted to sell. This time, we're not selling, this time we're telling."

CHANGING MINDSETS
As the world continues to evolve, every business will need to think this way because the pressure is coming from all sides. According to Forbes, 84% of global investors have changed their portfolios towards ‘green' investments, while one in three consumers in the UK have said they will not buy a product that's not sustainable. Looking to the upcoming generation, 56% of global Gen Z'ers said they won't work for a company that is not purposeful, while they won't buy something if they don't see themselves represented in that product.

The regulators have also come together in support of change. For example, the top 1,300 companies in the UK now have to report on their climate impact. While in the EU, new ‘green taxonomy' regulations mean that every company whose emissions rise above the threshold for hydrogen production - 3 tCO2e per tH2 - has to report on its climate impact.

"Whether we like it or not, the pressure is on," Gihan says. "The risks of not having an ESG comms strategy is that you will not be at the same level as your peers or your competitors, which means you're going to lose market share. You will also lose talent - you've already seen it in the ‘Great Resignation'. People don't care about the perks of work anymore - they care about purpose."

"If organisations don't shout about what they're doing, or don't highlight how they're doing so, and by when they're planning to achieve it, they risk alienating their customers, they risk losing their employees - or even attracting the talent - and, most importantly, they risk lose the backing of their shareholder and stakeholders."

She says that transparency and honesty are more important than ever. "The risk of you not highlighting what you're doing is going to cost you the growth of your organisation and impact your competitive edge."

STRENGTHENING THE STRATEGY
There are three steps organisations can take to strengthen their ESG comms strategy, Gihan says. "The first is to get your hands on the materiality assessment of your sustainability strategy - this document tells you, as a communicator, which parts of ESG you company wants to focus on. Based on that, you will be able to determine what themes your strategy is going to have and the topics you want to focus on. For example, for one of my clients, the theme was ‘people, prosperity, planet'."

"The second is to figure out who your key stakeholders are - the people who will bring the strategy to life. For me, there are five you have to get on board - the CEO, the CFO, the CMO, the chief risk officer and the HRD," she adds.

"The third step is to test the strategy with three different sets of audiences," she continues. These are the cynics who always scrutinise what you're doing, the believers who really believe that your organisation can do good, and the buyers who are buying your products and services and don't care so much about the ‘why' and the ‘how' - they just want the ‘what'. "You have a good strategy when you have these three on board," Gihan says.

"To embed ESG effectively, it needs to be led from above but pushed from below"

Once the strategy has been defined, the next step is embedding it into the company, which is where organisations must work closely with their HR departments. "It needs to be weaved within the employee lifecycle, from the time they are being recruited to the type of questions they're being asked, to their annual reports and scorecards, to off-boarding and interviewing," Gihan says. "To embed it effectively, it needs to be led from above but pushed from below."

GREENWASHING VERSUS GREENHUSHING
On the controversial subject of Greenwashing, she says this pernicious practice can be reduced by "being transparent in how you're claiming your claims and not being afraid of admitting that you're not getting everything right".

Highlighting the large number of companies that are working hard to drive the ESG agenda without publicising their work, she says: "The reason they're not talking about it is they're afraid because they know they don't have the right data. For me, I would actually rather you tell me that you haven't got it completely right yet than not tell me everything."

"If you're not communicating, you're going to alienate me as your consumer, your investor, your employee or your supplier," she adds. "Be honest - tell me that you're getting it wrong but that you're trying your best to get it right. Always say something rather than nothing."

To learn how to design a successful ESG communications strategy, sign up to the CIPR's new course ‘Introduction to ESG'.