Chief sustainability officers’ new pitch to CEOs: climate action isn’t about morals—it’s about money

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Good morning. From searing heat waves to regulatory rollbacks, sustainability is a tough topic for global leaders. When asked, every CEO I talk to says that climate change is real. They acknowledge the need to address the societal and climate impacts of AI, draw on diverse pools of talent, build resilient supply chains, pay attractive wages and seek a higher purpose than just generating profits. Many don’t want to talk about it, and may be quietly relieved that the SEC has proposed rescinding 2024 climate-related disclosure rules as “overly burdensome” for companies. 

But CEOs should pay attention to the conversations and research coming out at the Aspen Business & Society Summit this week. Many of the attendees here are leading sustainability efforts inside America’s largest companies, trying to tackle tough problems like climate change, income inequality, and the impact of AI. They are reframing their mission from moral imperatives to business imperatives like resilience, risk, recruitment and reinvention. Conversations here last year resulted in a shared effort among more than 20 attendees to create a framework for demonstrating the value of sustainability investments that was just published in HBR. A key takeaway: CSOs and CEOs need to speak the same language; shift the sustainability conversation from compliance and carbon targets to capital allocation and cash flow, building a business case around cost, risk, revenue targets and potential profits.

Because the conversations here are under the Chatham House rule, I can share this year’s takeaways but not quotes or names. While there’s deep concern over how the AI era is unfolding —dominated by a few tech players who are amassing great wealth and able to donate vast sums to politicians who keep regulation light—several attendees told me they feel less panicked about the outcomes for workers amid efforts to redesign jobs and reskill people. As with geopolitics, they’re getting used to navigating a new reality, more pragmatic than optimistic. Some said greenhushing and other efforts to downplay sustainability have left them with less agency, budget or buy-in from C-suite colleagues to get things done. Few report directly to the CEO.

That said, I also saw signs of action. I spoke with several board directors who are seeking to understand and ask more questions about corporate AI strategies. I landed in Aspen to the scent of smoke from the seventh-largest fire in Colorado history, burning 160 miles away, and headed to rooms where I heard about investments in clean energy, circular supply chains and creative uses of AI or other tech to address climate change. (McKinsey notes that climate planning has prioritized flooding even though heat demands as much attention.) And nobody can ignore the breakdown in trust. Leaders see Gen Z’s pessimism about their future, Millennials’ desire to work for companies that share their values, and consumers’ demand for authenticity and proof that a company is walking the walk. If they don’t buy it, they won’t buy the products. Money talks.
Contact CEO Daily via Diane Brady at [e-mail]

This story was originally featured on Fortune.com