“Having a CVO in the Boardroom Ensures That Sustainability is a Fundamental Consideration in Decision-Making and the Value Creation Process” – Hans Reus

In today’s ever-evolving business landscape, where the pursuit of societal value alongside financial success is gaining momentum, leaders who embody this holistic approach are essential. In recognition of their significant contributions, the CVO of the Year Award celebrates CFOs who prioritize values beyond mere profitability and integrate them into the fabric of their organizations. In this interview article, we have the privilege of gaining insights from Hans Reus, a distinguished managing partner at Russel & Reynolds and a prominent member of the CVO of the Year Award jury panel. With his extensive experience in executive management search and expertise in sustainable leadership, Hans offers valuable perspectives on the key developments driving the transition from financial value creation to societal value creation in boardrooms, as well as the pivotal role of CFOs in shaping a more sustainable future.

What are the key developments that are accelerating the shift from financial value creation to societal value creation in the boardrooms?

Hans: “Financial value creation remains hugely important, but it’s not sufficient. If you define societal value creation as financial plus societal plus environmental value creation, then I think we’re on the same page. To quote Oxford Professor Colin Mayer: the purpose of the business is to produce profitable solutions to the problems of people and planet, not profiting from producing problems. 

There are several key developments driving this shift. 

Most importantly, there is mounting pressure from the five groups of stakeholders that every company needs to deal with: investors, government, employees, suppliers, and customers. These stakeholders are increasingly pressuring organizations to prioritize sustainability. Companies recognize that it is in their long-term interests to proactively respond to this pressure. For example, initiatives like the Green Deal in Brussels and the need for scarce top-talent are urging companies to focus on sustainability. Highly talented people have a choice; they want to work for companies that make a meaningful impact. Equally, customers and suppliers are demanding sustainable products and practices. Failure to address these pressures can also pose risks to a company’s reputation and operations.

There is a growing availability of green financing options and the increasing need for companies to meet environmental, social, and governance (ESG) criteria. Investors are incorporating ESG considerations into their decision-making processes.

No company can thrive in a society that is failing. It is in the best interest of companies to actively participate in the transition towards a more sustainable society. “

"No company can thrive in a society that is failing. It is in the best interest of companies to actively participate in the transition towards a more sustainable society"

Hans Reus

Hans Reus currently works as a consultant at Russel Reynolds Associates. He has developed a leading voice in helping clients align business practices with Sustainable Development Goals (SDGs). Through this he advises his clients on building profitable and sustainable businesses.   


Why is the shift from CFO to CVO so important? How would the addition of a Chief Value Officer make a difference in the boardroom?

Hans: “The Chief Financial Officer (CFO) is one of the most senior executives in every organization and plays a crucial role in the migration towards a more sustainable company and society. If we consider the transition to a more sustainable private sector as crucial, then the CFO becomes a key player in that field in every organization.

The shift from CFO to CVO is important because it signifies a broader perspective on value creation. An outstanding Chief Value Officer (CVO) brings a focus on creating value that encompasses financial, societal, and environmental aspects. The CVO ensures that the organization considers the broader impact of its actions and decisions, beyond financial metrics.

CVO’s bring a sustainable mindset that integrates sustainability into the core of the organization’s operations, culture, and strategy. They drive the adoption of sustainable practices, embedding them into all aspects of the organization’s activities. This includes engaging stakeholders, fostering a sustainable culture, driving disruptive innovation, and ensuring the long-term integration of sustainable thinking within the organization.

Having a CVO in the boardroom ensures that sustainability is a fundamental consideration in decision-making and value creation processes. It helps the organization navigate the complexities and opportunities associated with sustainability, leading to more balanced and responsible business practices.”

What do you think defines a good CVO?

First and foremost, a CVO needs to be an excellent CFO. A CVO is not an additional executive in the team, it is a CFO who focuses on both financial and societal value.. In our research, we identified five key elements that define a sustainable leader, which can be applied to a CVO or other executives. These elements are based on interviews with 55 executives around the world who were recognized as pioneers in sustainability by the UN Global Compact.

The first element is a sustainable mindset, which represents a deep intrinsic motivation to run a company in both a profitable and a sustainable manner. It involves embracing the idea that financial and sustainable goals are not mutually exclusive, but rather complementary. A good CVO has this mindset and inspires others within the organization to adopt it as well.

The second element is multi-level systems thinking. A good CVO understands the interconnectedness of factors such as climate action, biodiversity, technological and societal trends, and regulation. He or she recognizes that sustainability challenges are complex and require holistic solutions. They can analyze the impact of decisions and actions across multiple dimensions and consider long-term implications.

The third element is stakeholder inclusion. A good CVO understands the importance of engaging with diverse stakeholders, including employees, investors, communities, NGOs, and governments. They build strong relationships, listen to different perspectives, and seek collaboration to drive win-win solutions and sustainable change.

The fourth element is disruptive innovation. A good CVO is forward-thinking and embraces innovation to find new ways of creating value. They encourage experimentation, adaptability, and the ability to navigate uncertainty and change. They are open to disruptive technologies and initiate business models that can drive sustainable transformation.

The fifth element is long-term activation. A good CVO recognizes that the transition to a sustainable business model is a long-term journey with substantial obstacles along the way. They demonstrate resilience, perseverance, and the ability to learn from failures and setbacks. They inspire others to stay committed to sustainability despite challenges, and provide the required strategic insights, key performance indicators, reporting and incentives.

Overall, a good CVO combines these five elements to lead by example, drive sustainable strategies, and embed sustainability into the organization’s culture.

How can we increase the number of excellent CVO’s in an organization?
Hans: “Training and development are hugely important for that. There are many talented finance people, but they’re not all as far in their sustainability journey as they could be. Organizations and individuals typically go through multiple stages. At the most basic stage, they’re inactive, not fully aware or concerned about sustainability. Then, they become reactive due to mounting pressure from stakeholders such as investors, regulators and talent. The next stage is becoming active when they see sustainability as a sound business model. They realize that a sustainable business model is beneficial to the company as well as their personal goals. Finally, they become proactive, engaging others to create a more sustainable community. There are barriers to overcome in each stage. To have more sustainable CFOs, the education system can do more to incorporate sustainability. Additionally, organizations need to have the right incentives and culture in place, so people are rewarded for their sustainability efforts and feel comfortable speaking up. Selection of individuals, whether internal or external appointments, also plays a crucial role. Appointing someone who champions sustainability goals for a high-profile role sends a powerful signal to the entire organization.”

How can a CVO engage other CFOs, so that they start steering on impact within their own organization?

Hans: “My short answer is that CFOs need to fully integrate sustainability into everything they do, again in the company’s and their own long-term interest. For example, in their annual business planning cycle, they should review the long-term vision and ensure that sustainability is embedded in the core of the business plan. Listening to key stakeholders is essential, understanding their perspectives on sustainability in the next five or thirty years. Setting targets that consider sustainability and developing meaningful key performance indicators are also crucial. Reporting on sustainability efforts, including non-financial data, is vital. CFOs should ensure that, for instance, the ERP and performance management systems are ready to drive this. Sustainability needs to be part of their daily activities.”

"CFOs need to fully integrate sustainability into everything they do in the company's and their own long-term interest."

In your role as managing director of an executive search firm, do you see an increasing demand for CFOs or executives who focus on more than just financial value creation?

Hans: “Yes, we do see an increasing demand for CFOs and executives who prioritize sustainable leadership. Initially, sustainable leadership was rarely considered in position specifications, but that has been changing. We conducted an analysis across over 4,000 position specifications and found that sustainable leadership criteria were mentioned in around 5% of them, obviously a very low number. If we’re trying to make the private sector more sustainable, but we’re not applying knowledge of or passion for sustainability as one of the key criteria, it will take a long, long time for the private sector to reach that next stage in their sustainability journey. But by developing the model, and by engaging in conversations with clients around sustainability, sustainability is now mentioned in over half of our position specifications. But: while the percentage is increasing rapidly, there is still progress to be made: it is one thing that sustainable leadership is mentioned in a position specification, but that doesn’t mean that it is a pivotal selection criterion for selecting the final candidate.”

How can organizations attract the right talent for the role of a sustainable CFO?

Hans:  To attract the right talent for a sustainable CFO role, it is in companies’ long-term interest to ensure that sustainability is embedded in the position specification; not just in the section about the company, but also clearly outlining the responsibilities and selection criteria related to sustainability. During the interview process, employers can ask questions that assess the candidate’s understanding and commitment to sustainable leadership. For example, they can inquire about the candidate’s definition of long-term success for the business and their passion for addressing social and environmental challenges. Checking references and conducting psychometric tests that evaluate sustainable leadership can provide additional insights. Both the organization and the candidate need to be conscious of the organization’s current stage in their sustainability journey.

If the candidate is somewhat ahead of the company, he or she can really help the company advance in its sustainability journey. But if the candidate is too far ahead for that company, he or she will not be successful. That is true for both Chief Value Officers and other senior executives.”

The Chief Value Officer of the Year Award is an initiative of the Impact Economy Foundation in collaboration with de Baak and SeederDeBoer. Nominating an impact-driven CFO for this award was possible until 30 June 2023.

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