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The board of directors of a Fortune 100 company wanted to better understand governance and controls around its Environmental, Social, and Governance (ESG) commitments. The company is recognized as an industry leader in many aspects of ESG, but the board was concerned that much of what was currently done on a voluntary basis could soon become mandatory and would face additional scrutiny. This sense was driven by pending SEC rulemaking on ESG disclosures, increased demand for ESG data from investors and creditors, and the company’s own public commitments in areas such as decarbonization.

The board tasked our client, the director of corporate sustainability, with “mapping” governance of ESG. This was not a straightforward task as ESG at the company – as in most organizations – is not a distinct function or organization, but rather a set of topics the company had identified as material to its business and around which it had developed policies, programs, and processes to ensure effective performance. Accordingly, accountabilities for those programs resided in many different locations across the company.


ScottMadden worked with the corporate sustainability organization to define and document the current state of ESG governance. We started by scoping the effort to the set of high-priority ESG focus areas the company had identified through its annual materiality assessment. Next, we defined the specific aspects of governance that we sought to document for each focus area, including board oversight, executive ownership, existing policies and programs, performance metrics, performance assurance processes, and current disclosures. We reviewed existing documentation and met with key stakeholders throughout the organization to collect this information for each focus area. Lastly, we defined several key processes that bring all of these efforts together through a lens of ESG, including identifying material focus areas, developing strategies around ESG focus areas, and reporting on performance to both internal and external audiences.


ScottMadden’s analysis was published in an ESG Governance white paper that was presented to the head of the corporate strategy, the executive committee, and the board of directors. The paper answered the question of what current state governance was and provided assurance that the appropriate controls were in place. It also highlighted certain gaps, overlapping responsibilities, or needless complexity that the company was able to address. We highlighted for the company that its priority ESG focus areas were at different stages, and therefore maturity of governance varied. A key part of developing an ESG strategy is developing and defining governance. By defining the key processes that brought ESG issues together, we helped to better define the role of the corporate sustainability organization and communicate the need for clear processes across the organization.

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Contributing Authors

Eric Hanson Director
Jared Inselmann Director

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