The CoSec’s Role in Strengthening ESG Oversight: A 2025 Perspective
Introduction
In recent years, Environmental, Social, and Governance (ESG) considerations have emerged as critical determinants of corporate success and resilience. For organisations aiming to align their strategies with stakeholder expectations and regulatory demands, ESG oversight has become a pivotal area of focus. Among the key players in embedding ESG into corporate governance is the Company Secretary (CoSec). As we enter 2025, the CoSec’s role has evolved significantly, encompassing a strategic function essential for navigating the complexities of ESG oversight.
The Expanding Scope of ESG Oversight
The ESG landscape has undergone remarkable transformation, with increasing regulatory pressures, stakeholder activism, and the rise of sustainability reporting frameworks such as the Global Reporting Initiative (GRI), the Task Force on Climate-Related Financial Disclosures (TCFD), and the International Sustainability Standards Board (ISSB). A survey by PwC in 2024 found that 87% of global investors considered ESG factors integral to investment decisions. These developments underscore the necessity for robust ESG oversight mechanisms within corporate structures.
The CoSec plays a vital role in ensuring compliance with these frameworks, guiding boards through the labyrinth of ESG obligations, and fostering transparent stakeholder communication. Their expertise in governance places them at the nexus of legal, regulatory, and ethical dimensions of ESG.
Key Responsibilities of the CoSec in ESG Oversight
- Governance Framework Development- The CoSec is instrumental in developing and maintaining governance frameworks that integrate ESG principles. By advising boards on best practices, the CoSec ensures alignment with both global standards and jurisdiction-specific regulations. For instance, the UK’s 2022 Corporate Governance Code explicitly underscores the importance of ESG in boardroom discussions, and CoSecs in the UK have been pivotal in operationalising this directive.
- Board Advisory and Training- Board members increasingly seek guidance on ESG issues. A 2023 survey by the Institute of Chartered Secretaries and Administrators (ICSA) revealed that 74% of directors considered their understanding of ESG issues insufficient. The CoSec’s role includes designing training sessions, ensuring directors remain informed about emerging ESG trends, and equipping them to make informed decisions.
- Risk Management- ESG risks—ranging from climate change impacts to social inequities and governance failures—pose significant threats to organisational resilience. The CoSec collaborates with risk management teams to integrate ESG factors into enterprise risk management frameworks. This includes scenario analysis, such as assessing potential impacts of carbon taxation policies or supply chain disruptions due to geopolitical instability.
- Stakeholder Engagement- As organisations strive to enhance transparency, the CoSec facilitates dialogue with stakeholders, including shareholders, regulators, employees, and communities. They oversee the preparation of ESG disclosures, ensuring accuracy, compliance, and alignment with stakeholder expectations. Notably, the EU’s Corporate Sustainability Reporting Directive (CSRD), effective in 2024, mandates detailed ESG disclosures, a compliance area where the CoSec’s role is indispensable.
- Facilitating Ethical Decision-Making- Embedding ESG considerations into corporate culture requires ethical leadership. The CoSec acts as a custodian of ethical governance, ensuring that ESG considerations influence strategic decisions and operational policies. By doing so, they foster a culture of accountability and sustainability.
Challenges in ESG Oversight
Despite their critical role, CoSecs face several challenges:
- Regulatory Fragmentation: The lack of uniform global ESG standards complicates compliance.
- Data Accuracy and Availability: Ensuring reliable ESG data remains a significant hurdle.
- Board Resistance: Some boards perceive ESG initiatives as ancillary to financial performance.
Addressing these challenges requires CoSecs to continuously upskill, leverage technology, and advocate for the long-term benefits of ESG integration.
The Future of the CoSec Role in ESG Oversight
In 2025 and beyond, the CoSec’s role will continue to expand, driven by technological advancements and heightened ESG scrutiny. Artificial intelligence and blockchain are poised to revolutionise ESG reporting and compliance, areas where CoSecs must remain ahead of the curve. Additionally, with institutional investors demanding deeper ESG commitments, CoSecs will increasingly act as intermediaries between boards and external stakeholders.
Lumorus: Elevating CoSec Excellence
At Lumorus, we understand the intricate dynamics of ESG oversight and the transformative role of the CoSec. Our expertise lies in providing tailored company secretarial services that empower organisations to excel in governance and sustainability. By leveraging our deep knowledge and innovative approaches, we help boards navigate the complexities of ESG, ensuring robust compliance and strategic alignment. Whether through board evaluations, governance reviews, or ESG integration strategies, Lumorus is committed to fostering excellence in corporate governance.
Conclusion
The CoSec’s role in ESG oversight is both challenging and rewarding. As organisations strive to balance financial performance with societal impact, the CoSec serves as a cornerstone of effective governance. By championing ESG principles, they not only safeguard organisational resilience but also contribute to a sustainable future.
References
International Sustainability Standards Board. (2023). Sustainability disclosure standards: Overview and framework. Retrieved from https://www.ifrs.org
PwC. (2024). Global investor survey 2024: ESG insights and trends. Retrieved from https://www.pwc.com
Institute of Chartered Secretaries and Administrators. (2023). The evolving role of the company secretary. London: ICSA Publishing.