Governance Challenges 2022: Climate Governance

In brief: As climate change continues to impact business, stakeholders are expecting boards to take accountability in implementing effective climate oversight to protect the financial and long-term success of their respective organizations.

Companies must determine its approach in outlining the short-, medium-, and long-term climate-related goals that caters to the company’s industry and business strategy while also focusing on being realistic and setting timely goals to maintain board accountability.

Though climate oversight is regarded as a new discipline, NACD, in collaboration with four of our strategic-content partners (Marsh McLennan, KPMG, Pearl Meyer, and Sidley Austin LLP), has provided helpful tools, tips, and frameworks to help boards establish and improve their climate oversight risk and opportunity; utilize climate scenario analyses to assess their performance in mitigating climate risk; assess the role of executive compensation in evaluating and structuring climate goals and initiatives; and address any legal considerations companies may face regarding climate oversight.

Most relevant audiences: Board chairs, ESG committee chairs and members, sustainability committee chairs and members, risk committee chairs and members, nominating and governance committee members