Some facilities professionals think they can’t impact their company’s corporate governance strategy — but that couldn’t be farther from the truth.
By Scott Mason
When discussing businesses' ever-more-common Environmental, Social and Governance (ESG) strategies, facilities managers (FMs) often find themselves sticking to what they're most familiar with. The “E” and “S” pillars of ESG have more accessible entry points for FMs, while the “G” is an afterthought. But is it true that FMs can’t impact corporate governance initiatives?
According to Forbes, the “G” in ESG is defined as “an internal structure of carefully planned rules, regulations, practices and processes — all of which have a direct correlation to how a company is managed and run.” Now, that may not sound like it impacts the day-to-day work of FM professionals. However, corporate governance heavily influences an FM department's makeup and operating abilities — factors facilities managers should certainly care about.
A Foot in the Door With Reporting
Lisa Stanley, CEO of OSCRE International, believes that facilities professionals can indeed get a seat at the “G” table through effective data governance and reporting. “Corporate governance happens at the top in the C-suite and with those directly underneath them,” Stanley said. “But it has to be focused on effective data governance to provide an environment that allows the ‘E’ and ‘S’ to be developed.”
Facilities managers have become very familiar with this influx of data being churned out by numerous systems within their facilities. But as savvy FMs know, data is only as good as the information you can derive from it. Connexus recently highlighted the importance of good data governance, which can help organize collection and reporting strategies.
What’s essential to understand about FMs’ impact on any corporate governance is their ability to be seen as a trusted source of information to help executives and boards make these important decisions. “They are frontline at the facilities and able to monitor the facilities’ performance (or lack of performance, in some cases),” Stanley said. “Information collected there helps with asset lifecycle and supply chain management. But it's also the same information that enables investment managers to report that data, as they will now be required to deal with via changes coming through the SEC [concerning climate-related disclosures].” FMs can act as gatekeepers to this analysis, putting them in good standing with C-suite decision-makers.
To assist FMs who may not know where to start, Stanley said that OSCRE currently has a 10-part on-demand data governance certification course that will “equip participants with the tools and best practices needed to drive real change, real growth and [a] real advantage for the organization.”
Additionally, an on-demand learning program that addresses digital competency and environmental data management (in a similar format to the data governance certificate program) is currently under development and will be available soon.
Barriers to Success
Good governance often comes down to having strong processes and procedures, which FMs know may come with previously crafted constraints. Stanley noted the previous disconnect between the C-suite and facilities departments, forcing FMs to adapt to established ways of doing things rather than having a say in them in the first place.
One such example Stanley shared was about facility leasing. “[FMs] often will inherit locations that can constrain making physical improvements that reduce real estate’s environmental impact,” Stanley said. “Historically, FMs have not been included in that selection process. But they can contribute an extraordinary amount from a stewardship perspective in helping the organization make better decisions.”
FMs would do well to share their expertise with C-suite decision-makers on what can be achieved at a particular facility. This demonstrates effective corporate stewardship that is essential to good governance.
Change is Necessary
ESG, at its core, focuses heavily on change. To succeed, FMs need to get on board and modify their departments’ operations while adjusting how they do their jobs — even in the face of complex asks.
“For example, organizations set target dates for zero carbon emissions that may or may not have the underpinning to enable them to reach that,” Stanley said. “That edict is then sent to the people currently at the facility to figure out how that magical thing happens.”
But then comes the difficult step when FMs must present their compelling case to their boss — and their boss' boss: If the company’s goal is to reach zero carbon emissions by whatever date has been established, this is what must happen. “You have to be a change leader,” Stanley continued. “It will involve financial resources, it will involve time, and it will involve building additional skills within your workforce to make it happen.”
“At the end of the day, the expectation of a facilities manager is accuracy, consistency and transparency of the data that drives business decisions,” she said. If an FM can establish that to the upper management stakeholders, they’re well on their way to proving their worth in helping establish better corporate governance.