#12 Heike O'Donnell from instagrid on the relevance of ESG (Environmental, Social, Governance) for finance departments

"Sustainably and ESG topics have high media attention but can be
a jungle for businesses - understanding the underlying drivers
and picking the right standard is key"


Heike is a CFO of international tech companies. She started as an
Auditor at KPMG in Paris/France, worked in different finance and
business functions at large corporations and is now helping
start-ups to scale or grow internationally and prepare for
successful exits. In parallel, Heike provides trainings,
workshops and seminar work with the intent to demystify Finance
and to define and implement ESG business strategies.


During the first phase of the podcast, we spoke about the
importance of a wide range of experiences outside of Finance
functions for any CFO to better understanding the constraints and
objectives of colleagues and business partners. According to
Heike, the challenges of a start-up CFO is the relatively high
degree of complexity, almost similar to large corporations, all
while having fewer resources and a business that evolves rapidly.
Effectiveness in Finance, says Heike, is closely linked to the
entire Finance team and stands on two pillars: The "kitchen" and
the business. The kitchen (back-office functions, such as
accounting or reporting) provides integrity and trust to the
various stakeholders whereas Finance colleagues working within
the business teams (e.g. commercial finance) are forward looking
and drive performance. Often overlooked as “no news is usually
good news”, the kitchen team needs to be put in the spotlight
from time to time.


The second focus of the podcast was on ESG. Companies report on
the impact their business has on Environmental, Social,
Governance criteria due to a mix of market expectations and
increasing regulation and disclosure requirements. The
Sustainable Development Goals (SDG) established by the United
Nations are an important corner stone to define objectives and
measure results. Very tangible for me was the comparison of the
SDGs with OKRs (Objectives and Key Results) and the example of
how instagrid contributes to the reduction of CO2 emissions as
part of their core business model. We also discussed how to deal
with conflicting interests between profitability and ESG
measures. Finally, Heike gave useful hints what ESG strategies
mean for Finance: Understanding the variety of ESG standards and
picking the right one is key - and challenging in the current
jungle of standards.