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Building a communications strategy

ESG communications should be a cornerstone of an investor relations strategy, join this course to learn more.
Concept of communications strategy. Wooden cubes with speech bubbles linked to each other.

ESG communication is the sum of all sustainability-related messages that you broadcast, through earnings reports, half-year reviews, press releases, social media posts, blogs and any other mediums. It informs people about the ESG-related policies and practices you have in place.

This should be a cornerstone of an investor relations strategy – keeping shareholders and potential shareholders informed of your progress and future plans in all areas of ESG. Through their communications, there is a real opportunity for companies to show they are serious about integrating ESG in their business strategy. Amalgamating the required financial communications alongside ESG progress reports and announcements will blend the organisations strategies together and show to all interested parties how ESG is a key factor for management.

Key considerations

Most organisations will have an existing communications strategy and we have already covered in an earlier Step the importance of to an organisation of articulating its ESG strategy to the wide range of interested stakeholders. In designing a strategy it is important to be clear about what the message is and how it will be shared. It needs to be informative and interesting – the goal is not just to improve performance but to inspire others too.

An outreach strategy could be perfect for addressing investor feedback and questions. The media shapes public perceptions. Hence, a strong communications strategy is essential to communicate the company’s ESG efforts effectively.

More so than with other messages, it is important to consider the following.

a) Make it authentic

• be honest – acknowledge that your organisation is on a journey. Demonstrate how senior management is requiring and pushing for structural change within the organisation and the processes and adjustments that are taking place

• develop a regular reporting process – use this reporting to share data and demonstrate progress on an annual basis at least. Annual ESG or corporate responsibility reports enable an organisation to share its longer terms aspirations and its shorter term successes and areas of improvement

• pursue third-party validation – in the absence of a standard ESG-specific certification many organisations exist to validate a company’s ESG related performance. Partner with organisations specialising in environmental and social impact measurement and share this verification as part of your ESG story.

b) Make it personal

Data is important, but whether you are sharing your ESG story on social media, an internal townhall, or at a conference, it needs to connect with people to capture attention. Demonstrating the real-life impact of actions taken and being planned (especially if it can be brought back to the 17 Sustainable Development Goals) will help your audiences understand your ESG strategy better. Examples of this include:

• putting environmental savings into real-life terms (e.g., the amount of water saved equalled the water use of a certain population sized city, the number of trees saved by not printing documents)

• explaining how a policy change will benefit all employees

• sharing personal stories from an employee or community that benefited from your organisation (local outreach programmes, charities, support networks)

• having your leader share their motivation behind advancing ESG factors using their own words.

c) Use stories to amplify the impact

ESG is a relatively new area of focus and businesses and individuals are still trying to understand what it means and what it looks like in practice. Communicators can play a key role in explaining an organisation’s ESG strategies. With an effective and compelling story, they can demonstrate progress and motivate key stakeholders to support their ESG strategy.

Impact of getting the messaging wrong

Getting it wrong can have significant implications for a company. Examples include:

Environmental: Pacific Gas and Electric (PG&E) declared bankruptcy after it was found that the company’s faulty equipment, combined with drought conditions related to climate change, had caused two wildfires in California within the space of two years, killing more than 80 people and destroying properties. It has been termed the “first climate change bankruptcy”

Social: In February 2017, Susan Fowler wrote a blog post about the engrained sexism and sexual harassment within Uber. The post went viral and led to CEO and founder Travis Kalanick being forced out of his job

Corporate governance: Fashion retailer Boohoo was found to be lacking in internal controls with an inadequate corporate governance framework and poor leadership ethics. The company was found to have allowed third-party suppliers to pay less than the minimum wage to workers. These governance issues have led to a major restructuring of the business.

Example checklist

Whilst there is no standard checklist that companies must employ, the following areas are worth considering when building a strategy:

• define your purpose specifically rather than making generalised statements

• encourage your leadership team to share messages as a demonstration of the tone from the top

• support end-to-end transparency as a demonstration of a commitment to honest reporting and to mitigate the risks of being accused of greenwashing

• centralise your ESG content by collating all your information in one easy-to-find place as this will support your ESG credentials more effectively

• measure your impact to allow you to share progress and growth in your ESG efforts

• monitor ESG political and activism risks either from governments or other stakeholders to avoid being unprepared if there is a risk of becoming targeted

• prepare for tough questions either bout your own company or your sector’s performance.

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