A personal take on how Microsoft is living out its ESG mission
This blog is the second in our series of guest posts from the judges of the IFS Change for Good Sustainability Awards. Here Michelle Lancaster, Director, Sustainability at Microsoft, discusses how Microsoft is prioritizing sustainability both internally and externally and why events such as the COP26 and the Change for Good Sustainability Awards are crucial to turn Environmental, Social, and Governance (ESG) momentum into action.
My journey into sustainability has not just been a straight line, but an evolution throughout my time at Microsoft over the last eight years. My personal experience from working initially as Senior PR Manager, Corporate, External, and Legal Affairs and subsequently Director of Public Affairs, has given me huge exposure to key ESG topics across the board—including accessibility, environmental sustainability, global supply chain, human rights, legal diversity and LGBTQ issues.
But more, it has been amazing to see, for the best part of a decade now, how Microsoft has been evolving its focus on sustainability. I have experienced at first-hand how a global company truly lives out its ESG mission and I have carried that forward into my current role as Microsoft’s Director of Sustainability Partnerships, Sales and Products. In two and a half years our sustainability practice team went from five people to 15 people and now to 25—with a laser focus on how we can use all the levers of a trillion-dollar company to allow it to make a meaningful difference in the future of the planet.
Environmental shifts hit home
But first, I would like to say that it’s not just from my work where I have clearly seen the growing emphasis on climate shift in recent years. My family lives in Washington State, and here we have witnessed both extremes of a changing climate. Every year we go up to the mountains and you can visibly see the glacier decline, while, flipping the script, it has rained ash from wildfires for six of the seven years we have lived here.
It’s clear to me that if we don’t do something relatively quickly with all the power and influence businesses have—then we all aren’t going to be in a great place in the next five to 10 years.
Change of business mindset required and people are intrinsically part of that change
From a business perspective, there now needs to be a mindset pivot from looking at sustainability and Corporate Social Responsibility (CSR) issues as “nice to have” to making them core to business strategy. By that I mean it needs to be as much as a part of metrics, KPIs and reporting as financial reporting is. This needs to translate into a metric of success based on a pre-set goal to ensure company leadership is really held accountable.
At Microsoft we have linked sustainability directly to executive compensation, with bonuses held subject to progress against specific sustainability commitments. We have also brought engineers and salespeople into the ESG fold—thinking about how we can encourage change across our entire technology ecosystem.
One of the key mentors spearheading this sustainability drive within Microsoft and providing me a great source of ESG inspiration is Dr. Lucas Joppa, Chief Environmental Officer at Microsoft and global environmental advocate. He is a Fellow at the UN Environment Program World Conservation Monitoring Center and his scientific background —along with his Ph.D., Dr. Joppa holds a B.S. in Wildlife Ecology—combined with who he is and how he leads across the board have been key to the growth of our sustainability practice group within Microsoft.
We’re all on the same page, from the top down. It’s all here in our Sustainability Report—you can see just how serious Microsoft is in becoming carbon negative, water positive and zero waste.
Here’s my take on putting together an ESG business strategy
For organizations wondering where to start to address the root of their own sustainability challenge, I like to think there are three key steps to make an ESG strategy a core business principle:
- Set an ambition – This should outline where you want to be and where your company wants to be in 10 years’ time. It is important this is an ambition not a goal, because goals can be easily achieved and if this is the case then you aren’t setting the bar high enough.
- Build a roadmap – This roadmap should outline how to reach this ambition based on the best information you have today. It’s okay to lean into ambiguity in this roadmap—such as “I cannot predict the price of carbon free steel in nine years’ time.” The ambition sets the market signals to create what might be needed to be implemented or adjusted in the back half of a long-term roadmap.
- Identify the blockers – There will be certain obstacles to overcome in every sustainability journey. Companies need to figure out where these blockers may be and use the core of their business strength to get past these. These will all differ depending on the company in question—levers of influence can range from capital to technology or industry expertise, and many more.
Where there’s an ESG will, there’s an ESG way
In order to accelerate sustainability progress worldwide there needs to be a mobilization of collective will across business, geopolitical and societal stakeholders. This is why events such as the UN Climate Change Conference (COP26) and the IFS Change for Good Sustainability Awards are so important to create a global dialog of change. There are few other places like COP26, where different countries can sit down next to each other and come to the climate negotiating table.
And COP26 provides the perfect forum for IFS to present its Change for Good Sustainability Awards, with entries from the global IFS customer base spanning every industry. I had the privilege to be invited to help judge the five different awards categories. Partners such as IFS are so close to the industry-specific challenges of their customers, and form a key part of Microsoft’s partner ecosystem—which is a massive contributor to our worldwide sustainability push. We place huge emphasis not only on our own sustainability goals but on working with our partners. We are with IFS, to help drive adoption of ESG-focused technologies and business initiatives.
Check out this blog to learn more about the IFS Change for Good Sustainability Awards, where IFS recognize excellence sustainability excellence across its community of customers. Winners have been invited to dine with Lewis Pugh in Glasgow during the UN Climate Change Conference of the Parties (COP26) in November 2021.