News: How sustainable is a business? CEOs and employees think very differently: RRA report

Leadership

How sustainable is a business? CEOs and employees think very differently: RRA report

The perception gap between CEOs and employees extends into their views about how well an organisation is doing in sustainability.
How sustainable is a business? CEOs and employees think very differently: RRA report

How well is your organisation doing in sustainability? That depends on whether you are an employee, a next-generation leader who directly reports to the C-suite, or a member of the C-suite. The lower down in the organisational structure you are, the less likely you are to believe that your organisation's sustainability performance is good, according to the findings of a new global study by Russell Reynolds Associates.

Released last week, the study, 'Divides and Dividends: Leadership Actions for a More Sustainable Future', examines the state of sustainability within organisations as measured by respondents' perception of areas such as how seriously an organisation is taking climate change, how good their sustainability practices are, or even whether the organisation has a sustainability strategy at all. The findings illustrate a perception gap that increased at every level. C-suite leaders think the organisation is doing better than next-generation leaders, whose estimate is still much more rosy than that of employees.

For example, 79% of C-suite leaders but only 54% of employees say the environmental practices of their company are on par with industry best practices. And 73% of leaders but only 48% of employees say that their organizations place the same importance on sustainability as they do on profits.

Why is this the case? The report describes this as the 'Say-Do Divide' - when  what CEOs say they do is markedly different from what employees see them do. Only 37% of C-suite leaders say leadership in their organisation leads by example, and the number drops to 31% for employees.

On the other hand, some of the report's other findings also suggest that exposure to the organisation's pro-sustainability activities play a role. For example, employees are less likely to have job responsibilities that involve improving the organisation's social and environmental outcomes, meaning that they have less opportunity to see what is being done at all.

Interestingly, the perception gap is reversed in the area of D&I, Employees are noticeably less likely than leaders to believe there is bias or favouritism in the organisation, possibly because they benefit from high-visibility initiatives such as training, workshops, business resource groups, or policies to make teams inclusive. C-suite leaders, on the other hand, are much more likely to believe that there is bias in hiring and promotion, which the report attributes to them having a broader view of the organisation as a whole.

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Topics: Leadership

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