When we first started collaborating with clients on ESG back in 2021, we assumed ESG was a well-integrated, structured function in most organizations.
We were wrong.
Here are three key insights we wish we had known earlier—and what they mean for companies serious about ESG.
In large organizations, the Chief Sustainability Officer (CSO) is often brought in to tackle environmental sustainability—carbon emissions, net-zero commitments, supply chain impact.
But here’s the catch: they are rarely involved in social (S) or governance (G) initiatives. This means:
✅ DEI (Diversity, Equity & Inclusion) efforts often sit under HR.
✅ Governance-related reporting is handled by legal and compliance teams.
✅ Many CSOs have no direct influence over ESG reporting structures.
💡 Our Recommended Best practice: CSOs should be integrated into cross-functional teams. Some leading companies now embed ESG within risk management, strategy, and operations instead of isolating it in sustainability teams. CSO should not own the accountability of reporting effectively on ESG but instead each department should own it.
We assume ESG is treated as a three-legged stool. In reality? Most companies put 90% of their focus on the environmental leg.
🔹 Only 28% of companies include ESG ratings in their official reports.
🔹 Yet 88% of institutional investors analyze ESG with the same depth as financial performance.
This gap means that social factors—like labor practices, human rights, and employee well-being—are often underreported. Governance, including ethical leadership and anti-corruption measures, gets even less attention.
💡 Our Recommended Best practice: The best ESG reports don’t just list sustainability achievements. They provide clear, measurable progress on social and governance factors. Companies leading in ESG transparency ensure their social impact metrics (e.g., workforce diversity, pay equity) are as robust as their environmental ones.
Where does ESG live in a company? The answer is... it depends. Unlike Finance or HR, ESG doesn’t always have a clear home. In many companies:
✅ It’s under Finance, focused on reporting and investor relations.
✅ It’s under HR, linked to diversity and employee well-being.
✅ Sometimes, it’s spread across multiple departments, making accountability unclear.
The problem? Without a clear ownership structure, ESG efforts become fragmented. Companies struggle with reporting consistency, compliance, and strategic alignment.
💡 Our Recommended Best practice: Some of the most effective ESG strategies come from companies that position ESG close to the CEO or Board of Directors. This ensures ESG is embedded in decision-making, not treated as an afterthought.
If you’ve worked in ESG, what do YOU wish you had known before starting? Drop your thoughts in the comments. 👇
📩 Want to discuss ESG strategy? Reach out at hello@communique.global