The Harvard Law School Forum on Corporate Governance https://corpgov.law.harvard.edu The leading online blog in the fields of corporate governance and financial regulation. Mon, 01 Jun 2026 18:58:06 +0000 en-US hourly 1 https://wordpress.org/?v=6.5.8 https://corpgov.law.harvard.edu/wp-content/uploads/2024/02/cropped-photography-4-e1706898544564-1-32x32.png How Does the Board Oversee ESG? – The Harvard Law School Forum on Corporate Governance https://corpgov.law.harvard.edu 32 32 How Does the Board Oversee ESG? https://corpgov.law.harvard.edu/2020/12/21/how-does-the-board-oversee-esg/?utm_source=rss&utm_medium=rss&utm_campaign=how-does-the-board-oversee-esg https://corpgov.law.harvard.edu/2020/12/21/how-does-the-board-oversee-esg/#comments Mon, 21 Dec 2020 14:00:13 +0000 https://corpgov.law.harvard.edu/?p=135192?d=20201221090013EST Posted by Paula Loop, Paul DeNicola, and Barbara Berlin, PricewaterhouseCoopers LLP, on Monday, December 21, 2020
Editor's Note:

Paula Loop is Leader, Paul DeNicola is Principal, and Barbara Berlin is Managing Director at PricewaterhouseCoopers Governance Insights Center. This post is based on their PwC memorandum. Related research from the Program on Corporate Governance includes The Illusory Promise of Stakeholder Governance by Lucian A. Bebchuk and Roberto Tallarita (discussed on the Forum here); For Whom Corporate Leaders Bargain by Lucian A. Bebchuk, Kobi Kastiel, and Roberto Tallarita (discussed on the Forum here); Socially Responsible Firms by Alan Ferrell, Hao Liang, and Luc Renneboog (discussed on the Forum here); and Toward Fair and Sustainable Capitalism by Leo E. Strine, Jr (discussed on the Forum here).

Now that you know what the board is overseeing when it comes to management’s development and execution of an ESG strategy, how exactly does the board go about overseeing these efforts? The board will have to consider a number of different topics/issues.

Where responsibility lies: Because ESG strategy should align with business strategy and focus on material risks and business drivers, the full board will want to understand the ESG messaging and how those risks are being mitigated. If this is a new area of focus for the board and the company, directors may need to assign detailed oversight to specific committees to help the ESG strategy launch smoothly. Ultimately, ESG issues will be relevant to all committees. For example, the nominating and governance committee will be interested in the shareholder engagement element, while the compensation committee will be interested in accountability through compensation. The audit committee will be interested in the disclosure, messaging, and metrics.

As the board determines where ESG oversight will be assigned, it may want to consider the following questions:

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