Building a Business Case for ESG Strategy

For associations aiming to integrate Environmental, Social, and Governance (ESG) goals into their strategic planning, we outline how to align ESG initiatives with your mission and member value proposition.

This article was originally published in Boardroom magazine in February 2024.

Incorporating ESG goals into strategy is one of today’s hot topics for association leaders. But unless your association has a very specific ESG related purpose, such as renewable energy or the defense of minorities, it is unlikely that it will be easy and obvious to agree what your position should be on a host of ESG related topics. So what can you do about it?

Who are we doing this for?

Simply put, you can start by asking yourself: who are/should we be doing this for?

A common stumbling block appears to be the gap between association staff teams’ desire to “do more” on ESG topics but finding it difficult to relate those back to mission – and crucially – to the member value proposition.

Take an obvious event example around food selection at events – the sustainable option of local, primarily plant-based menus may be great for the organizing team seeking to reduce their event carbon footprint but will your members appreciate that? Or will (at least some) view it as a reduction of choice, or a diminished offering compared to what they usually get?

The same goes for educational programs and diversity objectives – promoting new faces is not always easy when the paying attendee expects to hear from “the top names” in the sector.

In times where costs are continuously increasing, associations must be seen to keep delivering value for money. The reality is that well-intentioned “it’s the right thing to do” arguments alone will not convince Boards or Executive Committees to embrace ESG strategies, nor satisfying members scrutinising budgets.

Building your business case for ESG

Creating compelling ESG strategies that resonate with Association Boards necessitates the development of a robust business case.

In that area, research shows a few different things: younger generations prioritize environmental consciousness and diversity, as revealed by the Deloitte Millennial Survey 2020. Concurrently, corporations are actively engaging in efforts to demonstrate their commitment to ESG, as highlighted in the Harvard Business Review’s exploration of “The Comprehensive Business Case for Sustainability.” Furthermore, regulatory momentum is building, with entities such as the Sustainability Accounting Standards Board (SASB) paving the way for formalized ESG reporting for large organizations.

Within this context, association leaders can shape ESG strategies to align with their business models. Anticipating the expectations of future members, these strategies must actively support ESG initiatives to foster a sense of belonging rather than transactional relationships. Moreover, attracting and retaining new and diverse talent is critical for the association’s evolution, challenging the conventional boardroom participant profile. Simultaneously, considering the perspective of emerging association staff is essential, as the recruitment and retention of this talent pool hinge on aligning organizational values with their aspirations.

As for events, often the public face of associations, they carry a substantial environmental footprint. As corporations increasingly scrutinize their participation, associations relying on corporate involvement in events may face inquiries into the event’s alignment with internal objectives and future reporting requirements. By framing ESG strategies within the association’s overall business model, a transformative opportunity emerges.

This approach allows leaders to shift the narrative from the potential costs and efforts associated with ESG implementation to a more nuanced exploration of the risks inherent in not adopting such strategies. It initiates a crucial dialogue that underscores the imperative of embracing ESG measures as an integral component of future-focused and sustainable (from both revenue generating and operational perspective) association practices.

“Shift the narrative from the potential costs and efforts associated with ESG implementation to a more nuanced exploration of the risks inherent in not adopting such strategies.”

Using the UN SDGs as a conversation starter

Embarking on the journey of ESG integration presents a challenge as it permeates every facet of an association’s activities and organizational model, a potentially daunting prospect. Yet, reframing this challenge offers a positive perspective, providing numerous avenues to showcase how the association’s activities inherently align with and support broader ESG objectives.

The 17 United Nations Sustainable Development Goals provide a useful reference to start thinking about what your association does and how it may be (even inadvertently) supporting them.

Perhaps your environmental footprint is not best-in-class because you run large events – but maybe that makes you excellent at knowledge sharing, capacity building and creating partnerships. Maybe you have well developed programs to support gender equality or diverse representation in governance structures, and that compensates for work that needs to be done on other areas.

Sometimes, associations take what they already do for granted so the first (and very motivating step) can be to look at what you’re already doing and build on that with a focus on member and external communications.

The Long Journey Cliché

The saying that a journey of a thousand miles starts with a single step may be an old one but it is very fitting to conclude on – the ESG journey is one where expectations will continuously be updated so it is unlikely to be “done” in our lifetimes.

There is no reason to delay taking small but tangible actions, starting with the business case assessment and how to relate your current activities to the broad SDG framework.

MEET THE AUTHOR

Colm Clarke

Partner, Consultancy

20+ years’ experience in management services, business events and associations. Colm ensures clients are asked the right questions.

Driving change whilst building consensus is central to his work, which usually involves developing vision into organisational structures, educational content, and communications.

Curious, and at ease with complexity, Colm combines creative spark with analytical rigour. Always seeking elegant solutions which like the best guitar riffs, appear deceptively simple until we try to replicate them.