This complex topic was front and center at the latest Fortune virtual roundtable, with directors and executives from an array of industries joining to share their experiences with and predictions for ESG. While their opinions varied, the consensus among the participants is that there’s plenty of room for growth in this important area, and that its success can be a massive differentiator between a company and its competitors. 

According to Christa Quarles, the CEO of Canadian software company Corel, discussion of ESG dates back to before the pandemic, most likely emerging around 2017 with the Time’s Up movement before including social justice and climate in the ensuing years. 

“It’s not like we can let up on any of them. So I think it’s the biggest challenge that I’ve seen,” she said. “How do we make sure that we’re getting the right experts in each of the fields we’re leaning in? And from the leadership perspective, how are we rolling compensation into the mix? Should we compensate our leaders for zero-carbon emissions? We certainly are beginning to compensate our leaders for diversity. Watching how we put in different rules and regulations from a governance standpoint has stepped up all the requirements that we need as board members and leaders.”

Anne Sweeney, president of BUA Ventures and formerly of Disney and Lego, believes that the key to improving ESG is knowing your audience, both consumers and employees. She pointed out that millennials are much more likely to take a job based on ESG metrics when compared with boomers, and that Lego reduced its plastic packaging owing to younger fans’ demands. 

“Having a fulsome conversation about this at every board meeting and not isolating it as a separate issue—it really needs to be in the mix, and it needs to be in the mix all the time,” she said, later adding that “if it doesn’t start at the top, I think the board has a responsibility to surface it.”

The makeup of a board is also extremely important, several panelists agreed. In order to truly advance ESG, the composition of shareholder representatives can’t be the stereotypical bunch of older, white golfing buddies. While Sweeney said that she hoped companies would evolve to the point where the board didn’t need to play such a big role in driving these changes because leadership would take care of it, Quarles disagreed. 

“I hope, in some ways, that the role of the board doesn’t change at all. And by board, in this case, I’m talking about a forward-leaning, diverse, highly functional, communicating group of individuals who, by virtue of their diversity, are giving perspective and point of view to a leader whose job it is to move that organization forward,” Quarles said. “It’s the boards that are doing that today that I think will be the ones that, hopefully, survive.”

Of course, stakeholders still want to see the numbers behind ESG, whether that’s in profits or how a company is lessening its environmental impact. In the latter area, that often comes from consumers, who don’t want to buy products from a company they see as wasteful. Beyond Meat chairman Seth Goldman believes that boards should pay special attention here to ensure their companies are quantifying results and proving they are not just paying lip service to the issue.

“Frankly, I think some of these carbon offsets are greenwashing,” he said. “A company that is [emitting] tremendous amounts of carbon and then buying offsets isn’t really carbon neutral. They’re just sort of paying guilt money. If I were a board [member there] I’d say, ‘Let’s look at the real impact of our operations, not what we do with our guilt payments.’”

Neglecting any or all of these issues can imperil a company, according to AmerisourceBergen board member Henry McGee. “I think that boards are becoming increasingly aware that it’s also going to affect their ability to get investors,” he said. “If the customers and the employees don’t get their attention, the shareholders will certainly get their attention.” 

To that end, the company has gone beyond climate and diversity issues to examine what it’s doing politically, especially in the wake of the Jan. 6 Capitol riot. All of this is overseen by its governance, sustainability, and corporate responsibility committee, which has the full attention of the board in its effort to attract and retain customers. “To look into the future, I think it’s going to remain and likely grow as these issues become more complex,” McGee added.

That’s the kind of leadership from a board that’s necessary but is often lacking these days, according to Brian Stafford, the CEO of corporate governance software maker Diligent.  

“The boards where there are directors who are appropriately trained or can leverage what’s being done in another board, you see more movement in the right direction,” he said. “Across our client base, there’s still a lot of people who are looking for more direction—directors who are looking to know what they should be doing to be able to help guide and push their companies in the right direction. Unfortunately, there’s not as much sophistication…as we’d hope.”

Not all corporations, of course, are going to invest in areas that aren’t as popular—as Quarles said, some private equity firms will still invest in a coal company if the profits look good—but more and more, ESG is becoming big business. “It has to be in the company’s DNA,” said Marie Ffolkes, a board member at home improvement manufacturing conglomerate Masco. The company has tied ESG to its CEO compensation, which has led to its becoming a more integral aspect of the leadership side of the business. “We spent a lot of time on social justice issues,” she said. “It impacted [the CEO] so deeply that he actually got emotional on our board call. He’s taking it quite seriously.”

It’s that kind of investment in ESG that Sweeney touted when the panelists were asked for their predictions about how it will continue to affect the corporate world. “We’re in a position to make true progress on a lot of fronts, but the boards will have to stay on top of it,” she said. “More than that, the CEOs are going to have to drive that into the culture.”

McGee, wrapping up the roundtable, took it one step further. “It’s going to be driven by customers, it’s going to be driven by employees, and it’s going to be driven by the market,” he said. “That’s where people are going to want to put their money—into companies that are focused on this. Not only is this trend here to stay, it’s going to continue and is going to be baked into the basic responsibilities of the board.”