Is it Time for Sustainability to be a Pocketbook Issue for Executives?
History suggests that many industries periodically reach inflection points, where factors other than profits, returns, and share price really matter. They generally occur when the business case for major change becomes clear and cannot be ignored. It’s at these points where compensation can help signal change.
Today, we believe many industries have reached such inflection points with sustainability (i.e., operating in the interest of corporate, environmental, and societal good at the same time). This significantly increases the urgency to respond.
The recent rise in public discourse that corporations are bad for society makes the time ripe to ramp up efforts to align sustainability with company missions, core competencies, strategies and pay. Putting corporate executive’s pay at risk would help demonstrate their commitment and help quiet critics who have been busy casting such executives as opportunists.
Read the rest of the article at The Conference Board Governance Center Blog.