IOD Interview - Why ESG must Move from Good Intentions to the Heart of Board Strategy

Aligning Purpose, Performance, and Governance Through ESG

Introduction: As the University of York prepares to open its new campus in Mumbai, Professor Charlie Jeffery argues that ESG can no longer sit at the margins of organisational life. In this conversation with Director Today, he explains why CSR and ESG are not the same, why purpose raises, rather than lowers, the bar for governance, and why boards must now treat sustainability as strategy rather than sentiment.

In developing the University of York Mumbai, we are not simply exporting a curriculum. We are extending a reputation, a set of values, and a governance model into a new context with its own stakeholders & expectations.

You recently addressed the Institute of Directors (IOD), India on “Making CSR Work”. Why is this theme so timely?

Because organisations are now operating in an environment where good intentions alone are no longer enough. Stakeholders want to know not only what an institution says it stands for, but how seriously it governs itself, how it manages risk, and whether its values are truly reflected in decision making.

For universities, that feels especially immediate. We are long-term institutions. We plan in decades, not quarters. We operate on the basis of public trust, and we are judged by whether we create opportunity, generate knowledge that advances society, and educate people whose skills and talents will benefit the wider world. So, for me, this is not a peripheral conversation. It goes to the core of institutional leadership.

In your speech, you drew a clear distinction between CSR and ESG. Why does that distinction matter so much?

Because the two are related, but they are not interchangeable.

CSR has traditionally been shaped by intent: wanting to be a good corporate citizen, supporting communities, building legitimacy and reputation, and expressing values through philanthropy, volunteering, community initiatives or environmental projects. Done well, it can be meaningful and important.

ESG is something more structural. It is about performance. It is about whether sustainability and responsibility are built into the operating model of the organisation - how it is governed, how risk is managed, how decisions are made, and how performance is measured.

Put simply, CSR asks, what do we choose to do because we want to be good? ESG asks, what must we build into the structure of the organisation so that it remains credible, resilient, investable and sustainable? That is the crucial difference. The world has moved from good intentions to hard expectations, and boards have to respond to that shift.

So is the real issue that too many organisations still treat ESG as a communications exercise? And do you think if ESG sits beside strategy rather than inside it, it becomes a mere bystander to the whole process?

In some cases, yes. ESG cannot be treated as a reporting exercise or a communications layer applied after the real decisions have already been taken. If it is not influencing the core choices of the organisation, then it is not functioning as governance; it is functioning as presentation.

If ESG sits beside strategy rather than inside it, it becomes theatre. And markets, regulators, investors and stakeholders are increasingly good at spotting theatre. The real test is whether ESG is shaping major decisions - strategy, capital allocation, risk appetite, incentives and oversight. If it is not influencing those things, then no matter how wellpresented, it is not yet embedded. And stakeholders are increasingly adept at telling the difference.

As a university leader, what perspective do you bring to this debate that may be distinct from the corporate world?

Universities bring a particularly strong perspective on the “S” in ESG. For us, the social dimension is not an addon; it is the core of our purpose. Education is one of the few interventions that can genuinely change life trajectories at scale. It shapes income, health, civic participation, productivity and intergenerational opportunity. So when people ask what the “S” looks like in practice, universities can answer very directly.

It looks like widening access and social mobility. It looks like building skills for the future economy. It looks like creating pathways into decent work. It looks like contributing to community wellbeing. And it looks like producing research that improves lives.

That gives universities a distinctive responsibility. We should be able to show what it means for the social dimension of ESG to be more than a slogan - to be a measurable commitment with real consequences.

But you also made the point that “purpose does not exempt institutions from governance”. Why is that so important?

Because in mission-led institutions there can sometimes be an assumption that good intent is enough. It is not. In fact, purpose raises the bar.

Mission-led institutions can still make poor decisions. They can still operate with weak controls, unmanaged risks or blurred accountability. So, the question is not simply whether your purpose is admirable. The question is whether your governance is strong enough to deliver that purpose responsibly, consistently and transparently.

That is true in business, and it is equally true in higher education.

So how do boards actually “make CSR work”?

My view is that CSR works when it becomes a pipeline into ESG - when good intentions mature into embedded practice.

CSR can be extremely valuable. It can mobilise people, strengthen culture and create momentum. But ESG is where boards institutionalise that momentum - through strategy, risk management, accountability and measurement - so that responsibility survives leadership changes, market shocks and organisational growth.

The goal is not simply to do good things. It is to ensure that responsibility is built into the way the organisation actually functions.

In practical terms, what separates serious ESG from performative ESG?

From our experience at York - and from what one sees in the strongest boardrooms - three shifts matter.

The first is a shift from add-on to architecture. ESG cannot sit on the margins as a compliance artefact. It has to sit where power sits: in strategy, risk appetite, capital allocation, executive incentives and reputational oversight. If it is not shaping the biggest decisions, it is not really ESG at all.

The second is a shift from narrative to evidence. ESG has to rest on measurable commitments, not simply polished language. Boards need clarity on targets, on how progress is tracked, on who is accountable, and on what happens when performance falls short. Measurement drives management.

The third is a shift from risk avoidance to strategic advantage. The most effective boards no longer view ESG as a defensive or box-ticking exercise. They see it as a source of resilience, competitiveness and long-term value. Organisations with credible governance, trustworthy data, ethical supply chains and serious climate planning are not simply “doing good”. They are reducing risk, building trust, attracting talent and strengthening confidence. In volatile environments, that is strategy.

In some cases, yes. ESG cannot be treated as a reporting exercise or a communications layer applied after the real decisions have already been taken. If it is not influencing the core choices of the organisation, then it is not functioning as governance; it is functioning as presentation.

That third point is interesting - ESG as a strategic advantage, rather than simply risk mitigation. Can you expand on that?

Yes. In volatile environments, resilience is strategy. Organisations with credible governance, trustworthy data, ethical supply chains and serious climate planning are not simply “doing good”. They are reducing exposure, earning trust, attracting talent, strengthening stakeholder confidence and protecting long-term value. That is why the best boards no longer see ESG as a box-ticking exercise. They see it as a way of becoming stronger, more investable and more durable over time.

How is the University of York applying this thinking as it prepares to open in Mumbai?

We are very clear that in developing the University of York Mumbai, we are not simply exporting a curriculum. We are extending a reputation, a set of values, and a governance model into a new context with its own stakeholders and expectations - and one from which we also expect to learn.

That means ESG has to be translated into operational choices.

On the environmental side, a new campus forces you to confront sustainability honestly. It has to be designed into energy systems, water use, waste management, procurement, operations and lifecycle costs. It cannot simply be an architectural flourish.

On the social side, our task is to make impact real rather than rhetorical. That means widening access, supporting talent across backgrounds, building employability pathways through industry partnerships, creating meaningful mobility opportunities, and treating student wellbeing as a governance responsibility, not a footnote. It also means connecting with the context of Mumbai itself - aligning teaching and research with the priorities of the city and its communities, including future technologies, environmental resilience and inclusive growth. In that context, we are delighted to have appointed Professor Lindsay Oades as Provost of our Mumbai campus. Lindsay brings exactly the kind of academic leadership and values-driven institutional perspective that will be essential in ensuring that York Mumbai is shaped not simply for growth, but around student success, academic quality and meaningful societal impact.

And on governance, the focus is straightforward but fundamental: disciplined due diligence on partnerships, careful management of conflicts of interest, responsible and secure use of data, oversight structures that can handle complexity across geographies, and above all the protection of academic standards.

Why do you see India as such an important setting for this conversation?

Because India is one of the world's most dynamic economies, but also one of the most consequential arenas for global sustainability. Decisions taken here - in boardrooms, in policy, in education and in finance - will resonate far beyond India itself.

As we prepare to launch in Mumbai, I find myself returning to two central questions: how do organisations evolve and grow without eroding trust - socially, environmentally and institutionally? And how do they govern complexity in ways that earn legitimacy wherever they operate?

Those are among the defining questions of the next decade, and India will be central to how they are answered. That is one reason why our developing relationship with the Institute of Directors India matters so much.

Finally, what is the one message you would leave with board leaders?

That the organisations most likely to thrive will be those that can translate purpose into governance and governance into measurable, enduring impact. For us a university, particularly one extending its presence into India, ESG is not simply an institutional requirement. It is also a societal responsibility. Education is where the next generation of leaders, innovators and citizens is formed. So getting this right is not simply about organisational success; it is about the wider contribution institutions make to society.

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