Five Ways to Turn ESG Into Action
- 1 day ago
- 8 min read
Updated: 16 hours ago
Ari Yuda Laksmana is an Executive Coach, ICF PCC, and Mentor Coach, a leadership development expert, and author of Coaching-Verse. With 15+ years in human capital and leadership, he helps executives and organizations navigate change, unlock potential, and create sustainable impact.
Sustainability has moved firmly into the boardroom. Companies are setting Environmental, Social, and Governance (ESG) targets, publishing sustainability reports, making climate commitments, and introducing policies intended to demonstrate greater responsibility toward people, society, and the environment. Yet one question receives far less attention: what must leaders actually do differently for those commitments to influence how a business operates?
In my work across leadership development, business coaching, and sustainability, I have increasingly come to believe that this is where the real challenge begins. Sustainability does not become real simply because an organization has a strategy. It becomes real when leaders translate that strategy into everyday decisions, conversations, priorities, behaviors, and trade-offs.
What sustainability leadership means
Sustainability leadership is often discussed through the language of climate commitments, ESG targets, governance requirements, responsible investment, or sustainability reporting. These are all important, but they represent only part of the picture. Leadership begins when we ask what we actually do with all of that information and how it changes the decisions we make.
For me, sustainability leadership is the capacity to make business decisions today while remaining accountable for what those decisions create tomorrow. A leader still needs to deliver results, serve customers, develop employees, satisfy investors, manage costs, and remain competitive. At the same time, a decision that appears successful today may create costs that only become visible later, whether through environmental impact, employee burnout, damaged trust, poor governance, reputational risk, or declining organizational capability.
This is why sustainability leadership requires us to expand the time horizon of decision-making. Instead of asking only whether a decision will work, leaders also need to consider what that decision will create, who will experience its consequences, and whether it strengthens or weakens the organization’s ability to create value in the future.
Closing the leadership gap
Organizations undoubtedly need ESG frameworks, reporting standards, targets, data, policies, controls, and people with specialist sustainability expertise. The challenge is that frameworks alone do not change behavior. A company may have a responsible sourcing policy, for example, while procurement leaders continue to face intense pressure to select the lowest-cost supplier. An organization may publicly emphasize employee well-being while managers normalize late-night messages and unsustainable workloads. Governance policies may encourage transparency while employees remain reluctant to question senior leaders.
I think of this as the leadership gap between sustainability ambition and business behavior. At one level, the organization communicates what it believes and intends to achieve. At another level, leaders, managers, and employees make thousands of decisions every day. The distance between those two realities determines whether sustainability becomes embedded in the business or remains primarily part of its reporting and communication.
This is why I often return to a simple principle: strategy can be written on paper, but transformation happens through people. Sustainability is increasingly connected to mainstream business management. International Financial Reporting Standard S1 (IFRS S1), for example, organizes sustainability-related disclosures around governance, strategy, risk management, and metrics and targets. These are not peripheral activities. They sit at the heart of how organizations are governed and managed. The challenge, therefore, is not simply whether leaders understand ESG, but whether they can translate that understanding into action.
1. Translate ESG clearly
One of the fastest ways to disconnect people from sustainability is to make it sound like a language that only specialists can understand. Acronyms multiply, frameworks become more sophisticated, reports become longer, and yet someone working in sales, operations, Human Resources (HR), finance, or procurement may still be wondering what sustainability actually means for their role.
Leaders have an important translation responsibility. If environmental responsibility matters, people need to understand what changes in procurement, operations, logistics, product design, energy use, or investment. If social impact matters, the connection should become visible in hiring, employee development, customer treatment, leadership behavior, and community relationships. If governance matters, it should influence accountability, transparency, decision rights, risk conversations, and the willingness to challenge questionable decisions.
The objective is not to turn every employee into an ESG specialist. It is to make sustainability understandable enough for people to act on it. If employees can explain the company’s sustainability commitments but cannot identify a single decision they should make differently because of them, the strategy has probably not travelled far enough into the organization.
2. Face hard trade-offs
Sustainability leadership sounds relatively straightforward when purpose, profit, stakeholder interests, and short-term performance all point in the same direction. The real test emerges when they do not. A more responsible supplier may initially cost more. Developing employees may require time that could otherwise be spent delivering immediate output. A profitable business opportunity may introduce environmental, social, or reputational risks. A transformation that strengthens long-term resilience may also create short-term discomfort.
These are the moments when sustainability becomes a leadership practice rather than a corporate statement. Strong leaders need to be willing to explore the tension rather than pretend it does not exist. They need to understand what the organization is gaining, what it may be risking, who benefits, who carries the cost, and which consequences may not appear on this quarter’s dashboard.
Sustainable leadership is therefore not about avoiding difficult choices. It is about making those choices with a broader awareness of their consequences. A sustainable business still needs to remain economically viable, but financial performance should not become an excuse for overlooking costs that appear elsewhere in the system or later in the future.
3. Ask better questions
This is where sustainability and coaching come together most naturally for me. Leadership has traditionally rewarded people who know the answer, and there are certainly situations where leaders need to provide direction quickly. However, complex sustainability challenges rarely offer one simple answer. They involve uncertainty, competing stakeholder interests, long time horizons, interconnected systems, and consequences that may be difficult to predict.
In those situations, the ability to ask better questions becomes a leadership capability. Through coaching conversations, I have repeatedly seen how the quality of thinking can change when someone is invited to examine an assumption rather than immediately defend a position. A leader might ask what the team is currently treating as fact without sufficient evidence, whose perspective is missing from the conversation, what new risk might emerge if the strategy succeeds at scale, or which stakeholder will eventually carry the consequences of today’s decision.
These are coaching questions, but they are also strategic questions because they slow down premature certainty and improve the thinking that precedes action. Research from the International Coaching Federation and Human Capital Institute found that 73% of respondents agreed coaching helps employees understand and implement organizational ESG initiatives. Coaching does not replace sustainability expertise. It serves a different function. Sustainability expertise helps leaders understand what matters, while coaching can help them examine how they think, decide, take ownership, and act on what matters.
4. Build shared ownership
A chief executive officer (CEO) cannot personally make every responsible decision inside an organization, and neither can a Chief Sustainability Officer or ESG team. Sustainability begins to scale when people throughout the organization can make sound decisions without constantly waiting for instructions from the top.
I describe this as leading through others. As organizations grow, leadership impact is no longer measured only by the quality of decisions a leader personally makes. It is increasingly reflected in the quality of thinking and decision-making that happens when that leader is not in the room. This requires clarity, trust, accountability, and deliberate capability building.
A directive leader confronted with a problem may immediately tell someone what to do. A leader using coaching skills might instead begin by asking what the person thinks should be done and what impact the proposed decision could create. The second conversation may take longer, but it develops something the first approach often does not–independent thinking. Over time, that thinking capability becomes organizational capacity.
This matters because sustainable transformation cannot remain dependent on a few passionate individuals at the top. If sustainability is expected to influence thousands of everyday choices, ownership has to spread across the organization.
5. Connect purpose and performance
One of the most persistent assumptions in business is that leaders eventually need to choose between purpose and profit. I believe that framing is becoming increasingly unhelpful. Purpose without performance eventually becomes difficult to sustain, while performance without responsibility can eventually weaken the conditions that make performance possible.
A more useful question is how leaders can create performance that can endure. Viewed through this lens, employee well-being is connected to the organization’s ability to sustain performance. Trust affects collaboration, decision speed, and whether employees are willing to raise risks. Leadership development influences adaptability. Governance shapes decision quality and accountability. Environmental choices increasingly influence resources, costs, reputation, regulation, customers, and long-term resilience.
Once these relationships become visible, separating “business” from “sustainability” becomes increasingly artificial. Sustainability ultimately asks whether the way an organization creates value today strengthens or weakens its ability to continue creating value tomorrow. That is clearly a sustainability question, but it is equally a business and leadership question.
Where leaders can start
The UN Global Compact and Accenture 2025 CEO Study, drawing on insights from nearly 2,000 CEOs across 128 countries, found that 88% of CEOs believe the business case for sustainability is stronger today than it was five years ago, while 99% plan to maintain or increase their sustainability commitments. What interests me most about findings like these is that the challenge appears to be moving beyond commitment and increasingly toward execution.
For leaders, this does not necessarily mean starting another initiative. A valuable first step can simply be to observe what already happens inside the organization. Look at where important decisions are made, what happens when targets conflict, which questions leaders ask under pressure, what behavior gets rewarded, and what employees do when senior leaders are not present. Then compare those observations with the sustainability commitments the organization communicates publicly.
The gap between those two realities is not something to hide. It is useful information because it shows where leadership development, culture change, or capability building may need to begin.
From reporting to leadership
Sustainability standards, credible measurement, reporting, governance, and accountability remain essential. Organizations need them, and leadership should not be used as an excuse to lower the rigor of sustainability management. What is important is recognizing that reporting and leadership serve different purposes. A sustainability report can describe targets, risks, commitments, progress, and performance, while leadership determines what happens after that report is published.
It influences the next investment, the next difficult trade-off, the next conversation with an employee, the next decision about a supplier, and the next moment when someone must choose between what is expedient and what is responsible. Over time, these seemingly small decisions accumulate and become culture.
The organizations making meaningful sustainability progress will therefore need more than sophisticated sustainability language. They will need leaders who can translate commitments into decisions, decisions into behavior, and behavior into culture. Sustainability, after all, is fundamentally about our relationship with the future, and shaping the future has always been one of leadership’s most important responsibilities.
Start the conversation
At your next leadership meeting, consider asking one question, “What leadership behaviors need to change for our sustainability commitments to become everyday business decisions?” Then avoid the temptation to answer it too quickly. Allow the conversation to reveal where the real gap exists.
You may discover that the next step in your sustainability journey is not another framework, dashboard, or policy. It may be developing the people who need to make all of those things work.
If you are a business owner or organizational leader exploring how sustainability leadership and coaching can strengthen responsible growth, leadership capability, and long-term business performance, connect with me to continue the conversation.
Read more from Ari Yuda Laksmana
Ari Yuda Laksmana, Sustainability Leadership & Business Coach
Ari Yuda Laksmana is an Executive Coach, ICF PCC, and Mentor Coach, leadership development expert, and author of Coaching-Verse. With over 15 years of experience in human capital, learning, and leadership development, he has held senior roles with multinational organizations and now coaches executives and leaders across industries and cultures. He is the Founder of CoachingYuk, a digital coaching platform created to make professional coaching more accessible, and has pioneered integrating digital and AI-enabled coaching into leadership development. Ari was recognized as CEO of the Year 2024 by APAC Insider. His work centers on one belief: better leaders create better people, organizations, and impact.
