L.E.K. Consulting survey notes executives acknowledge that the internal alignment, metrics, capabilities, culture and governance needed to meet sustainability targets are not in place
Companies around the globe have made earnest, often specific, commitments to environmental, social and governance (ESG) goals, but are struggling on the journey to meet them. In many cases the gap between their aspirations and the ability to execute on them is significant.
Among the barriers they face are divisions within the leadership team over how to balance short-term business and financial priorities with long-term ESG objectives, lack of processes and capabilities to build ESG programs, disconnects in strategy, product and service portfolios and supply chains, and internal cultures that are out of alignment. Aligning incentives and creating executive remuneration programs to support ESG is another significant challenge. Designing and executing effective ESG programs will require major rethinking of all these barriers and issues, in particular, greater internal consensus on the tradeoffs ESG and sustainability objectives require.
