4. Collaborate with Local Stakeholders & Communities  

Stakeholder engagement is a common strategy used among ESG practitioners to uncover the issues that matter most. This exercise involves reaching out to stakeholder groups like employees, customers, suppliers, and investors to see how they feel about your initiatives, what they’d like to see more and less of, and what other feedback they have.  

However, local communities are often overlooked as a stakeholder group. Sometimes this is because community groups and local NGOs are viewed as adversaries – they may have even challenged your approach in the past. Most often it’s because the “ripple effects” your business has on local communities are hard to see. Either way, it’s crucial that you leverage everyone, especially local stakeholder groups, in your climate strategy.

As part of your stakeholder engagement work, make an effort to understand: 

  • How the community feels about your presence in the area  
  • Any unintended consequences your business is having on their lives (pollution, gentrification of neighborhoods, decreased economic opportunity, etc.)  
  • What value your business adds or should be adding to the local community  
  • After you’ve identified gaps and problem areas, collaborate on potential solutions. To really move the needle, involve the local community in your decision-making processes and share power and accountability over the programs you create. Microsoft’s Danielle Decatur put it well during GreenBiz’s VERGE Net Zero conference: “the most important part about working with local community groups is moving at the speed of trust, not your bottom-line.”  

5. Engage Your Suppliers Beyond Scope 3 Emissions 

When it comes to supplier engagement, Scope 3 emissions have taken center stage. And for good reason – Scope 3 emissions usually account for 80-90% of a company’s total GHG emissions impact. Collaborating with your suppliers to reduce emissions is crucial to reaching global decarbonization goals. 

Yet your supply chain is also home to a variety of other social and environmental risks. Unfortunately, some of the most egregious human rights, health, and well-being violations occur deep within the supply chain.  

For instance, as part of their climate mitigation efforts, many consumer goods companies with palm oil supply chains are looking for ways to reduce biodiversity loss in sourcing regions like Indonesia and West Africa. Climate change and nature loss are inextricably linked, and the clearing of native forests for palm oil production is one of the leading drivers of deforestation. 

However, one of the less visible consequences of deforestation in palm-growing regions is the impact on local indigenous communities. Agricultural expansion leads to decreased natural resource availability, creating conflict, economic hardship, and land disputes. Indigenous groups often have restricted access to their traditional lands and are subjected to unfair agreements with governments and businesses. As a result, many are vulnerable to food insecurity, poverty, and human rights abuses. 

Your business has a central role to play in ensuring supplier communities are treated fairly, and transparency is the first step. Be sure to consider how your procurement practices impact sourcing communities holistically, and gather supplier data on topics like forced labor, fair wages, and human rights regularly.  

The best way to identify and address these issues is with a boots-on-the-ground approach, but the global nature of today’s supply chains can make this challenging. A good solution is to partner with local NGOs who specialize in responsible sourcing of specific commodities like soy, palm, cocoa, minerals, and fish.

6. Examine Your “Political Footprint”

Political advocacy is an often-overlooked component of climate strategy, but that’s starting to change. Two-faced corporate lobbying – when a company claims to stand for an issue but uses its political voice to undermine progress – is getting more attention in the news. As a result, you may already be feeling pressure from your shareholders to disclose your political spending, lobbying, and trade association memberships. It won’t be long before corporate political spending makes its way into today’s climate reporting frameworks, too.

In addition to double checking that your political spending aligns with your corporate values, use this shifting market trend as an opportunity to take a stand on issues you care about, such as ensuring a just transition to a low-carbon economy.

As a business, your voice matters. Leverage your political influence to advocate for policies that support aggressive decarbonization, equitable clean energy access, and climate mitigation investments for disadvantaged communities. The Inflation Reduction Act, which directs over $40B to communities with environmental justice concerns, is a great example.

In addition to supporting federal policies like the IRA, stay up to date with emerging regulation at the state and even city level. For instance, California passed a law requiring cities to include environmental justice considerations in their updated long-term plans. Use your clout as a local business to back these kinds of policies.

Next Steps 

It’s time to stop approaching social and environmental problems through separate lenses. Tackling the inequities of climate change means recognizing the interdependent relationships between issues like GHG emissions, inequality, health, and well-being. Without connecting the two, you risk (unintentionally) perpetuating the vicious cycle of climate change and inequality.  



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