In Discussion with Dr Rory Sullivan CEO of Chronos Sustainability.

Author: Natalia Vasnier Published: 10 Jan 2024

Interview n°4 of the Interview Series “Meet the changemakers” with Dr Rory Sullivan.

In December 2023, Natalia Vasnier interviewed Dr Rory Sullivan the CEO of Chronos Sustainability. Rory is also a Visiting Professor of Practice in the Department of Geography and the Environment at the LSE, and played a leading role in the establishment and development of Transition Pathway Initiative, located at the Grantham Research Institute on climate change and the environment.  His primary research focus is investment governance and the role that can be played by investors and the capital markets in delivering systemic change in sustainability performance.

Background and Chronos Sustainability

Could you tell us a bit about your background and what led to setting up Chronos Sustainability?

Prior to my PhD, I worked on corporate sustainability, developing and implementing environmental management systems, assessing corporate and project-related environmental risks and opportunities, and supporting regulators with the development and implementation of corporate reporting requirements (e.g. national greenhouse gas inventories, pollutant release and transfer registers). I also worked with Amnesty International on corporate accountability, investor accountability and trade and investment policy-related issues.

My PhD, which I finished in 2002, focused on self-regulation, specifically, how industry codes of conduct would shape corporate activity, and how these codes influenced public policy.

While not the primary focus of my research, I was increasingly interested in the contribution that the finance sector might play in supporting and enabling sustainability. Following my PhD, I was fortunate to get a job (first as Director, Responsible Investment and then as Head of Responsible Investment) with a large investment manager, Insight Investment. My role included company engagement, investment analysis, policy and surgery.

Following the global financial crisis in 2008, I moved into consultancy and spent a number of years working on responsible investment and sustainable finance. I had two broad categories of clients. The first were investment organisations (assets owners, asset managers) who needed help developing and implementing their responsible investment policies and strategies. The second were industry networks – organisations such as the Principles for Responsible Investment, the Institutional Investors Group on Climate Change – who needed help designing and implementing programmes and strategies that would drive change across the investment system as a whole.

Why did you decide to set up Chronos Sustainability?

Things started to change around 2015. Companies and investors started to think much more strategically about sustainability and what they needed from their advisors. They recognised that they needed to pay much more attention to implementation, and that this was not a matter of ‘quick wins’ but much more about longer periods of time.

By this time, I had been working closely Nicky Amos, who used to be the Head of Corporate Responsibility at The Body Shop, for a number of years. We both recognised that the change in company and investor perceptions of sustainability offered us the opportunity to make a difference at scale that was much greater than we could achieve as individual consultants. We also recognise that to deliver on that promise, we needed to have the resources and capability to deliver large projects over long timeframes – years rather than months.

We sometimes, jokingly, describe ourselves as 30-year overnight success stories. We have both dedicated our careers to sustainability and we have been fortunate that the past five years have seen so many companies and investors recognise sustainability-related issues as a key driver of long term business value.

What does Chronos do?

Our purpose is clear and is the first thing you see when you visit our website. We work with our clients and partners across a range of industries and sectors to deliver positive, substantial improvements in their sustainability performance, delivering real benefits for society and the environment.

We have been lucky to work with a series of organisations in the corporate world, investment, industry bodies who share that ambition and really want to think about how to deliver change at scale and how to execute that.

In terms of what Chronos looks like today, we have grown from a team of two (Nicky and I) to a team of 18 people over the past five years. In addition, we have some 12 associates who work regularly with us on projects. Over the past two years, we have hired six graduates from LSE from the geography, environment and development areas.

Who are the main clients of Chronos?

While approximately half of our clients are based in the UK, our work is global in nature. We work with companies and their subsidiaries around the world, we work with Investors who invest globally, and we work with organisations and networks with global memberships.

One of our key clients is the World Bank. We have worked with them in Thailand, Colombia, Malaysia, Peru, South Africa and Zambia on the design and implementation of sustainable finance policy and regulations, covering issues such as corporate reporting, investor duties and obligations, green taxonomies and green bonds and financing instruments.

Where do you see Chronos in the future?

Globally there is a structural demand for more support on sustainability and climate change, which will of course support our business. While I expect us to continue to grow, our business strategy is not driven by financial or head count growth targets. Our measure of success is ‘Do we have impact?’ and ‘Can we increase our impact?’. The latter questions can be answered in a number of ways: by growing our number of employees (and hence our capacity), by being cleverer and better at what we do, by building the capacity and expertise of our clients so that they can do more.

Corporate sustainability

What is corporate sustainability?

The notion of corporate sustainability starts from the recognition that companies have impacts on society and the environment. Many of these impacts are positive, e.g. through the goods and services that are provided, through employment and skills development, through paying taxes, etc. Some of these can be negative, e.g. through the consumption of resources, the generation of pollution and waste, through poor workforce management practices. In that context, corporate sustainability is about how do companies maximise their positive impacts and minimise or eliminate their negative impacts.

Unfortunately, at present, many companies still see corporate sustainability as an operational rather than a strategic issue, and assess costs and benefits and risks and opportunities over relatively short timeframes. Often that means that companies don't quite see the benefits of thinking holistically or ambitiously about corporate sustainability.

Companies cannot change overnight, the key thing we need to understand is that transition is a time dependent or time path concept.

Deep change and improvement takes times to be done properly and to be institutionalised within companies’ practices and processes. Too many NGOs and change advocates either fail to recognise this or fail to acknowledge it, often leading to situations where companies fail to respond effectively to the demands being made of them, a classic lose-lose situation.

One of the things we do really well, at Chronos, is identifying and understanding the obstacles to change and the constraints faced by business managers. We use these insights to help them implement solutions that quickly and effectively address the social and environmental problem in questions in a way that enables them to protect jobs or deliver their services. Frequently, we see companies radically transforming their businesses, but doing it at a pace their businesses can cope with. 

What steps should be taken for the world to become more sustainable and resilient within the corporate sector?

Companies actually do a pretty good job at a lot of sustainability issues. Many have already identified and assessed their main social environmental issues, established and implemented policies relating to these issues, and set targets to improve their performance.

But more is needed in three areas.

First, the way in which companies frame the business case for action on sustainability is often defined in narrow cost-benefit terms, and assessed over relatively short timeframes meaning that many of the long-term business benefits get discounted or ignored.

Second, companies tend to be very good at looking at the impact of social environmental issues on the business, they tend to be less good at looking at their impact on social environmental issues.

Thirdly, companies need to take more time to assess where they can have an impact. They need to sit down and think where does the company really add value? When you do that, you end up with people looking at their supply chains or customer relationships, maybe their interactions with other stakeholders.

Understanding transition in any sector, and the timeframes is basically the key to unlocking change.

COP28 and advice for the youth

Do you consider yourself more optimistic or pessimistic when it comes to the future?

I am a sceptical optimist.

I'm an optimist in that I believe that if we think cleverly, carefully and ambitiously about change, we can do deliver real change on social and environmental issues.

That said, I am not naive about the political or corporate appetite for change. We have to be sceptical when people have high mission statements or assert that particular actions are ‘win-win’. Such commitments and arguments need to be challenged and companies and actors need to be able to explain exactly what they are going to do. So, overall you need to remain optimistic that change can be delivered, but remain sceptical.

Was COP28 a success?

There were some positive outcomes from COP28, in particular the strong commitments to renewable energy, but probably not enough if we are to avert dangerous climate change. It was also encouraging to see fossil fuel phase out being discussed so explicitly, even if the final statement was weak on this point. The elephant in the room topics remains growth; it is difficult to see how we are going to achieve net zero without significant reductions in the quantity of resources, renewable and non-renewable being consumed.

What would be your advice to younger generations who want to build a career within the sustainability sector? 

To work within the sustainable finance sector there are several points to consider.

• This is now a highly competitive field attracting top quality candidates. You need a good degree, from a good university, and increasingly a postgraduate degree is also required.  

• Quantitative skills are critical as most of the entry level roles are in areas such as data management, business analysis and reporting.  

• You need to be resilient and commit to this area of war for the long-term. Changing people’s minds and getting them to work with you requires patience, empathy and the ability to develop long-lasting trusted relationships. It also requires deep technical skills and knowledge of the industry and sector you are working in. Implementation – changing cultures, practice, processes, strategies – take time and requires the ability to motivate, cajole and challenge.

Would I recommend a career in sustainability?

The answer is unequivocally yes but sustainability is a vocation as much as a career. Working in sustainability is one of the most professionally rewarding careers that you could choose. But it also carries a huge responsibility; the decisions you make, and the quality of your work will define the future of our planet. 

In February 2024, Chronos Sustainability will publish a guide to careers in sustainable finance. 

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Dr Rory Sullivan interviewed by Natalia Vasnier for The Conference Corner. Feature cover image provided by Dr Rory Sullivan.