Home » ESG » ESG vs Sustainability Consultants: Key Differences
Sustainability consultants are in great demand as more and more corporations and industries implement more ecologically friendly working practices. If you know sustainability and want the freedom to work as an independent consultant, becoming a sustainability consultant might be a rewarding career. An ESG consultant’s role is to find opportunities for additional investments in a company’s portfolio as well as to divest from those that are not socially responsible. They accomplish this by evaluating a company’s environmental and social issues, governance, and how these variables align with the client’s values.
What is a Sustainability Consultant and an ESG Consultant?
A sustainability consultant is a specialist who duties on a contract basis to advise businesses and organizations on becoming more socially and environmentally responsible. Other labels for this profession may be used by organizations, such as eco consultant, sustainability adviser, green consultant, or environmental consultant. However, the work is generally the same across organizations and fields. Businesses hire sustainability consultants when they need additional knowledge to design and implement strategies for more sustainable practices and products but do not want to hire a full-time employee.
ESG consultants are relatively new, yet they are gaining popularity among large corporations and investors. ESGs are an appealing alternative for responsible businesses because they allow them to examine things through financial and ethical lenses. However, it is still uncommon for companies to work with them regularly. To become an ESG consultant, you should have financial experience and any environmental science, social sciences, or company governance degree.
What do an ESG Consultant and a Sustainability Consultant do?
The activity of an ESG consultant falls under the umbrella of Sustainable Investing. Their role is to find any changes in a company’s portfolio for additional investments and divest from those that are not ecologically or socially acceptable. They also assist businesses and investors in determining their impact on society and the environment. ESG experts will tell their clients how much their investment is worth in cash after accounting for ethical consequences such as fossil fuels or private prisons. If the company’s “net worth” suffers, it will be reflected in its investment portfolio.
An ESG analyst’s or consultant’s usual consulting workload can take several shapes. For example, if they were to conduct due diligence on an institutional investor’s portfolio, they would review all of their holdings and make recommendations based on criteria like sector exposure, sector environmental strategy, and how it adheres to the company’s overall strategy and risk management policies.
A sustainability consultant is responsible for developing more sustainable solutions that are better for the environment while not inhibiting the business’s growth. Here is a list of typical responsibilities for sustainability consultants:
Evaluating a company’s environmental impact through study, such as calculating its carbon footprint, energy use, water consumption, waste output, and air quality.
Minimizing the company’s harmful environmental effects.
Expert knowledge on reducing the use of critical or scarce resources, such as electricity, water, or oil, is being shared.
Creating bespoke strategic sustainability plans for the business or organization.
Providing an overview of the company’s formal criteria and procedures and assuring compliance.
I keep current on studies and changes in regulations that affect the company and advise on any changes.
Developing plans to reduce waste in the company’s operating or production processes.
Collecting and analyzing various data connected to the business’s sustainability and providing reports to demonstrate the results.
Delivering reports to stakeholders.
Employee and stakeholder education and training on major environmental and sustainability topics.
Creating and implementing a variety of various sustainability projects inside the organization.
Assessing the building’s energy consumption and formulating plans to minimize or recycle energy.
Maintaining awareness of new technology or approaches that may improve sustainability and continuously advocating cost-effective and ecologically friendly practices.
Things to look for in an ESG Consultant job description
The job definition of an ESG consultant is fluid and ever-changing. They could be active in one or more of the following activities:
Identifying companies that are more (or less) concerned with the environment, social issues, and governance (ESG) than their industry competitors
Conducting ESG risk assessments on present investments to identify areas for divestiture or investment
Ongoing management of the client’s connection with businesses
Monitoring the implementation of the client’s internal policies and processes
Creating an ESG strategy and advising clients on how well they stick to it and whether any areas require additional effort
Many financial institutions hire consultants for ESG screening, company engagement, and report creation. Most large financial institutions today have an ESG strategy, department, or team with specialized knowledge in evaluating how well corporations operate regarding environmental and social criteria. These organizations seek to advise investment portfolio senior management on investment opportunities and hazards connected with specific sectors.
How to Get a Job as a Sustainability Consultant?
A sustainability consultant might come from any industry or background. The following are the steps to becoming a professional in this field:
1. Research a relevant field
Although there are no formal education requirements for sustainability advisers, those who hold these positions typically have a bachelor’s or master’s degree in environmental studies related to sustainable development, design, engineering, construction, environmental science, earth science, or a similar field of study. Some various colleges and organizations provide sustainability certification programs. Consider enrolling in a specialized graduate program to help you enhance your knowledge and abilities and prepare you for a position as a sustainability advisor.
2. Participate in an internship or as a volunteer
An internship or volunteer role with a sustainability-focused organization can also help you start your sustainability consulting career. Many charitable organizations focus on the environment; you can obtain experience by working for one of them. If you are pursuing a degree, you may gain internship or volunteer experience in a relevant field, or you may be able to complete a summer internship to boost your CV.
3. Gain work experience in a relevant field
Because competition for the various jobs in the sector is fierce, having relevant experience or certifications is critical for distinguishing yourself from other qualified applicants. Working on any project connected to the environment, ecology, recycling, or design can provide you with valuable insight into contemporary concerns concerning sustainability.
4. Make your way up
Your initial job will likely be as a graduate or junior sustainability consultant. You will be given more assignments and responsibilities as your career progresses. You might take on a leadership role within a few years to ensure your career progresses. As you gain expertise in your field, your income should rise, and you may be promoted to project manager. After several years of expertise, you will be qualified to work as a sustainability consultant.
Top Skills for Sustainability Consultants
The following are the most prevalent abilities required for most sustainability consultants:
Organizational skills: You must have highly developed organizational abilities to manage all legislation and related information. These abilities are also crucial for ensuring that all necessary paperwork for various tasks is appropriately created and filed away for record keeping.
Communication: A sustainability consultant must have excellent written and vocal communication skills to discuss sustainability concerns with various people, including other experts and the general public.
Knowledge: As a sustainability adviser, you should be well-versed in a wide range of environmental sustainability topics related to corporate practices and forms of production. You must constantly expand your knowledge and skill set to keep up with the current advances.
Presenting abilities: You may be expected to convey information to several stakeholders within and outside the organization. Therefore, your presenting skills and public speaking confidence should be well-developed.
Numeracy and literacy skills: You will typically conduct assessments and analyze data, research, and create reports, which is a complicated job that demands excellent numeracy and literacy abilities.
Problem-solving: skills are required to accurately assess instances and establish the appropriate approach for the business or organization with which you are working.
Companies and investors use environmental, social, and governance (ESG) data to make business decisions. ESG services are part of sustainable investment, considering environmental, social, and corporate governance issues and financial factors. Instead of just raw data, the finest ESG consulting businesses deliver actionable insights. Sustainable investing encompasses both socially responsible and impact investing. Sustainable investing will become increasingly important in creating investment portfolios in the future. ESG consultancy is becoming increasingly popular as more organizations are recognized for their excellent social and environmental effect.
Sustainability consultants might work independently or as part of a consulting firm. Hiring a self-employed consultant is often done as an independent contractor. Hiring a sustainability specialist from a consulting firm, on the other hand, is an option. Another alternative is to recruit someone as an employee for your firm. The selection is influenced by your company’s industry and business type, working hours, tax ramifications, and other factors. Many businesses engage sustainability advisors for specific projects to simplify budgeting their services.
Q1. How do sustainability and ESG interact?
ESG is a non-financial reporting structure encompassing numerous areas of sustainability. In contrast, sustainability is concerned with the social, economic, and environmental concerns that a company negatively influences and can, in turn, positively affect by changing how the firm works.
Q2. What are the many kinds of sustainability consultants?
Sustainability consulting has traditionally been divided into three major categories: audits, testing, verification, technical support, and strategy/planning. Although all three services have the above goals, they handle various parts of a company’s operations.
Q3. What does a sustainability consultant do?
As a sustainability consultant, you will assist firms in becoming more socially and environmentally responsible in their operations. You’ll need to find long-term solutions to the often-conflicting requirements of people, the environment, development, and commercial success.