From the strategies devised in boardrooms to the settlement of customer claims, every part of the insurance supply chain is undergoing an ethical awakening.

ESG – a company’s performance on environmental, social and governance matters – is moving to centre stage for businesses motivated on one hand by the carrot of ‘doing the right thing’ and on the other by the stick of incoming Sustainable Disclosure Requirements (SDR) and future regulation aimed at pushing businesses in a more ethically aware direction.

It all certainly sounds positive, but more cynical onlookers might point to the fact that committing to the theory is one thing and implementing real action is another matter altogether. In the context of high-profile greenwashing failures, how do business leaders actually ensure they are delivering on their promises?

Ollie Phillips, founder and CEO of Optimist Performance, has experience of leadership as a World-Series-winning England rugby captain and has also managed organisational change for major organisations during his time as a Director at PwC. He says company culture is a critical factor for those rising to the ESG challenge.

It is a view echoed by Paul Williamson, Managing Director of Realia Marketing, a leading integrated marketing agency within the insurance space. Creative, effective communication is at the heart of the Realia model, and Paul points out that it is also the root of the stakeholder engagement that is so fundamental for fostering the strong company culture Ollie advocates.

For many organisations seeking to enhance their ESG credentials, poor communication and culture are, therefore, key barriers to success. Strategies and plans fails because they sit in a silo – perhaps on the desk of HR, operations or marketing. Those teams will be fundamental to the ESG journey, of course, but in our experience, the message of change must saturate the whole organisation if it has any chance of being truly embedded.

To put that statement into an ESG context, it means going far beyond switching the lights off and, rather, embedding consciously ethical behaviours throughout all strategic and operational thinking and consistently incorporating ethical messages in a regular cadence of communication.

*When ESG objectives are deep-rooted into the culture in this way, they become second nature. They allow the ‘muscle memory’ of a team to tune in to the company’s ESG mindset and focus in on the measurable goals in question. Information meets engagement and results in action.

That’s not to say that engaging individuals, groups and whole organisations to participate on such a singular mission is easy. Be aware that when faced with situations that involve friction, people will instinctively fight, flee or freeze. And when no immediate answer is forthcoming or the cognitive load we are under is too heavy, people are pre-programmed to seek out the path of least resistance.

However, it is possible to manage these natural responses through appropriate methodologies and structures: give immediate feedback to reward desired behaviours; set clear expectations in terms of effort versus achievement; and handle objections and questions with sensitivity and respect.

Measuring progress is also a fundamental part of instilling cultural change – it gives stakeholders an agreed vision of what ‘good’ looks like to align and empower them. At a personal level, the knowledge that you are contributing to a shared purpose can also help answer the question of ‘what’s in it for me?’, underpinning all those sustained, individual micro-efforts that are needed to create collective momentum.

Peter Drucker, the often-quoted management consultant, once said that ‘culture eats strategy for breakfast’, and there are two ways to read this neatly worded idea. On the one hand, it’s a warning that even the best theories and plans can quickly be wasted when little thought is given to the people tasked with delivering them.

On the other, it can be read as a positive affirmation of the power that an organisation can summon up if it pays attention to its people, communicates with them well, and nurtures a culture that binds them together as one. That’s a message that can sustain any business, let alone those who are pushing to become better citizens of Planet Earth.

PW – September 2022