1 February 2024 – A business briefing produced by CISL and Accounting for Sustainability (A4S) examines the implications for CFOs and Finance Functions in supporting their businesses to become aligned with a sustainable future.
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About
Consensus is growing that businesses must become more sustainable and move away from short-term profit maximisation as their ultimate goal, in order to secure their long-term financial survival and to meet societal expectations of contributing to wellbeing for all people and planet. Alongside this, the body of financing and reporting requirements and regulations for corporate sustainability are rapidly emerging. To meet these requirements, companies need a suite of new sustainability skillsets, as well as evolved processes and reporting.
This report focuses on the implications for corporate Finance Functions, exploring the changes, capabilities and tools required for Chief Financial Officers (CFOs) and their teams to support the transformation and alignment of their organisations to purpose and sustainability that boards of directors will need to lead. Among the key enablers that are needed to help Finance Functions adapt to this changing environment outlined in the report are:
- sustainability knowledge and professional skills development supported by educational establishment and relevant professional bodies
- access to relevant data, particularly on Scope 3 emissions and social and ecosystem impacts
- systems and software to enable the integration of sustainability and financial information
- conceptual and technical developments to define methodologies and standards in specific accounting areas
- coherence of standards, regulations and frameworks globally to avoid Finance Functions spending all their resources keeping up to date with changing frameworks at the expense of driving sustainability improvements, and
- collaboration and sharing from leading companies of their learnings among each other and with those who follow, rather than each company having to start from scratch.
CFOs will play a critical role in this transformation process alongside other business functions. The report also presents some brief best-practice examples from leading companies, and outlines the vital importance of prompt action by CFOs to drive organisational change towards sustainability.
Citing this report
University of Cambridge Institute for Sustainability Leadership (CISL). (2024). Broadening the horizon: How CFOs and Finance Functions can help drive corporate sustainability. Cambridge, UK: Cambridge Institute for Sustainability Leadership.
