Four ways to engage your CFO and COO
This spring, we at the Center have been visiting member companies around the country. During these visits, one trend worth noting is that an increasing number of Chief Financial Officers (CFOs) and Chief Operating Officers (COOs) are participating in conversations about corporate citizenship. This is further evidence of the elevation of attention and the increased value placed on corporate citizenship.
The CFO and COO domains are expanding. Not only are these executives expected to manage the bottom line, operational risks, and compliance, they are responsible also for protecting and increasing all of the tangible and intangible assets of the company, including reputational assets. Corporate citizenship efforts are, more than ever, influencing employee, customer, and community perceptions and company reputation—ultimately affecting financial valuations.
Corporate executives increasingly accept as a given that well-designed corporate citizenship programs can be a differentiating asset to their companies, positioning environmental, social, and governance (ESG) investments to deliver both business and social value. In our travels, there are four behaviors that we have observed that effective corporate citizenship professionals adopt to contribute to the objectives for which CFOs and COOs are responsible.
Know your company’s business strategy and think carefully about how your programs can support the business goals of the organization. Strategies can change. Are you up to speed on your company’s most current strategy? Is there a new business line or acquisition that you need to understand better? Knowing your business strategy will help you ensure that you can deliver the most business and social value. If, for example, you are in a company with intensive intellectual capital needs, your corporate citizenship programs may be more focused on skills-based volunteering that targets the “S” dimensions of ESG. A manufacturer that has high numbers of shift workers and more environmental impacts may be better served by engaging more intensively in the “E” dimension.
Understand their pain points. Design your program to meet your company’s particular business needs and mitigate its negative impacts. If 10 percent of your company’s revenue comes from manufactured consumer goods and 90 percent is derived from intellectual property and reputation, the emphases of your programs should be designed in a way that is appropriate to those proportions. If retention and turnover is a huge problem for your company, employee programs may be your solution. If you are mostly concerned about the cost and usage of raw materials and your environmental impacts, you will likely want to make different investments. Is your CFO/COO concerned with getting a foothold in foreign markets? Is that market one in which consumers and employees have very high expectations of the company’s level of involvement in the community? You can help solve some of these problems. Position your programs so that it is clear how they contribute business value.
Speak their language. The most successful corporate citizenship professionals are great at speaking the language of their business leaders. Is your CFO concerned with managing risk related to climate change and supply chain? Make sure you know and communicate how your programs can help to mitigate that risk. Is your COO concerned about the ability of the company to attract qualified workers? Measure the engagement scores and turnover of employees who are engaged with your corporate citizenship program vs. those who have not yet engaged. Whenever possible, use the measures that are most meaningful to them.
Help them cut through the noise and focus on what is important. Are you staying abreast of the emerging trends in non-financial disclosure and reporting? Make sure to keep your corporate officers informed of what is happening in that arena and what peer companies are doing. Water is a hot topic, but is it a hot topic for your company? Are you tracking issues and interest groups as they gain traction and airtime? Can you describe the process for how you prioritize issues with which you think your company should engage? Develop a process for issue tracking and make it visible to your leaders and colleagues.
Ultimately, your executive officers are responsible for delivering increased financial value, whether through enhanced goods and services for customers or by establishing trust and credibility with employees, customers, and the community. Corporate citizenship can bring more focus to issues that are material to the business and its bottom line. Developing a program that helps your company deliver sustainable value over the long term is great for the company and will be valued by your executive officers.
Do you want to share a tip for your peers? Tell us how you created more business and social value and got the support of your executive officers here!