Learn How Leading Brand Estée Lauder Succeeds with ESG Management

The world of ESG can be intimidating when it comes to regulations, reporting and executive support. How does leading brand Estée Lauder achieve ESG management success?

The Environment and Energy Leader Solutions Summit took place online on July 19, 20 and 21, 2022. Leaders from many different industries came together for a series of candid conversations on the importance of ESG in creating a sustainable future and the challenges that come with meeting increasingly complex reporting requirements around the world. There were discussions about the ESG regulatory environment, ESG management software, the importance of data for ESG reporting and many other topics that are at the forefront of today’s strategic business discussions.  

The opening keynote session featured Aleksandra Dobkowski-Joy, VP of ESG at The Estée Lauder Companies. The conversation began with a look at how organizations are managing the rapid advance of ESG as a critical strategic priority over the last few years. “More has changed in the last five years than in the last twenty,” said Dobkowksi-Joy, acknowledging that ESG has moved from vague corporate social responsibility (CSR) principles to mandatory ESG reporting requirements in a very short period of time. She notes as well that while this puts a heavy burden on many organizations, it is, fundamentally, a very positive change, since it makes explicit the financial implications of ESG issues and forces organizations to be more structured and transparent regarding the way they manage ESG priorities. 

Leadership, Culture and Collaboration 

Leadership is also a critical component of a successful ESG program. As Dobkowski-Joy pointed out, having direct leadership from the C-suite—with ESG leaders reporting directly into the executive leadership team—provides the foundational building block for untangling ESG complexity. However, top-down leadership should not be considered a make-or-break condition for ESG success. Teams can instill sustainability values in the organization by embedding ESG characteristics into strategic planning and pushing them up the chain to the leadership team. Building your case by highlighting investor interest in ESG is also an effective way to secure top-down support. 

Having an organizational culture that supports and promotes ESG values is one of the elements that has helped Estée Lauder achieve success with its ESG program. “Leadership from every chair” is how Dobkowski-Joy describes a culture that encourages every employee to contribute to the ESG strategy in any way their position allows them to do so. One example of this culture is product development, during which designers are expected to integrate sustainability characteristics into every development stage. This culture extends beyond the boundaries of Estée Lauder to include suppliers and partners, with whom there are regular conversations about how to find collaborative approaches to sustainability innovation.  

Collaboration also extends to the customer relationship. As Dobkowski-Joy relates, today’s customer has a much deeper understanding of sustainability issues than in the past, which means higher expectations for how Estée Lauder responds to customer priorities, including ensuring that product design elements like packaging not only meet the luxury standards that are part of the Estée Lauder brand but also uphold sustainability principles based on lifecycle analysis. 

The Importance of Data and Technology in ESG Management

With ESG regulations quickly moving from voluntary to mandatory, it’s time for every organization to embrace the world of data and the ESG software required to manage it. An effective ESG program that meets the expectations of all stakeholders needs high-quality data from every production facility across the organization. As Dobkowski-Joy points out, this is not an easy task, which means internal collaboration is important. Estée Lauder’s sustainability teams work closely with internal auditing and global financial controls teams to create the structures for data quality and assurance audits and to set internal goals. This approach takes advantage of existing templates and expertise while maintaining the flexibility to meet the constantly evolving requirements of ESG principles and reporting. 

Estée Lauder’s dynamic, leader-driven approach provides a benchmark other organizations can use to measure their own success as they work towards creating effective ESG programs. In upcoming blogs, we will look at insights from some of the other sessions at the Environment and Energy Leader Solutions Summit. 

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