CFOs have become essential to drive sustainability efforts. They manage complex investments and ensure rigorous ESG reporting alongside IT to improve data workflows.
For much of the past decade, sustainability sat on the fringes of large enterprises. It lived in corporate responsibility reports, brand narratives and pilot projects led by environmental teams with limited authority.
Fast-forward to today, where regulatory mandates, investor expectations and climate-related risk pull sustainability into finance. As environmental, social and governance (ESG) reporting becomes more formalized, CFOs are being asked to sign off on disclosures that regulators, boards and capital markets increasingly treat as decision-grade information.
As a result, sustainability is becoming a finance-led discipline that requires the same rigor as financial reporting and strategy. As sustainability investments grow in scale and complexity, CFOs must weigh tradeoffs across capital allocation, operating costs, risk reduction and long-term competitiveness.
For CIOs and IT leaders, this evolution creates a clear mandate: Partner with the CFO to turn ESG from a scramble for data into a repeatable, auditable business process that connects its outcomes to financial performance.
How CFOs can lead sustainability
Sustainability is becoming a CFO mandate for two key reasons, according to John Mennel, climate tech practice leader at Deloitte. They are the following:
Sustainability investments are getting larger and more complex, which pulls the CFO into decision-making.
"In jurisdictions where sustainability reporting is mandated by regulation or required by investors, the CFO is often required to sign off," Mennel said. "That brings the same expectations around quality, transparency and accountability as financial statements."
Rob Konferowicz, an analyst with CFO Shortlist, sees a similar shift in the U.S, even in regions with less uniform regulations.
"In the U.S., sustainability moved from being more corporate-level and supportive to something much more strategic," Konferowicz said. "It is now tied to capital allocation, risk management and regulatory exposure in certain industries."
That pressure is spreading. Sustainability reporting often sits with the CFO because it parallels financial reporting, according to Ben Montalbano, technical director of ESG at Schellman. As organizations move from voluntary to compliance-driven reporting, they need financial-grade rigor.
The CFO's role as gatekeeper of capital allocation also makes finance central to sustainability leadership. CFOs exert the most influence by defining metrics, controls and disclosures, while working closely with the CIO on how to source and govern data, Konferowicz said.
The finance function depends on IT to operationalize ESG reporting and sustainability data workflows. This partnership is not optional.
Finance-led sustainability initiatives can also surface overlooked opportunities by applying a sustainability lens to operations, Mennel said. He cited a hospital system that discovered anesthetic gases made up 12% of its carbon footprint. Reducing waste reduces emissions, cuts costs and benefits patient care.
Finance and IT: The new sustainability partnership
As the CFO's sustainability leadership expands, the finance function depends on IT to operationalize ESG reporting and sustainability data workflows. This partnership is not optional. Most ESG metrics originate outside finance systems, across facilities, manufacturing, supply chain and procurement.
"IT plays an instrumental role in capturing how the data flows into the office of the CFO," Konferowicz said. "That includes integrations, data lineage, automation and data quality."
This work is a classic data management challenge, according to Mennel. Organizations must assemble data from parts of the business that have never been integrated into a single reporting pipeline.
"IT needs to put systems in place that allow companies to collect high-quality, transparent data," Mennel said. "For organizations doing this for the first time, that is a heavy lift."
The partnership works best when IT understands the context behind ESG requests, Konferowicz said.
"It is not someone in the office of the CFO telling IT, 'We need ESG data,'" he said. "The why matters."
These teams also face a recurring source of friction. Finance wants ownership of the reporting process and, in many cases, the tools that support it. IT needs to support integrations, security, controls and data traceability.
"IT works best when it gives finance that ownership and plays the supporting role. If IT builds from its perspective, user adoption drops off from finance," Konferowicz said.
How CFOs influence sustainable technology decisions
CFOs influence sustainable technology decisions through capital allocation discipline and risk governance. Even when sustainability teams set priorities, CFOs translate them into budgets, timelines and investment hurdles.
"It is the internal rate of return over the duration of the project," he said. "Does it meet the rate of return? How does it roll up into a portfolio of investments?"
That is especially true when sustainability initiatives promise long-term efficiency rather than immediate savings. Finance teams already evaluate investments that require upfront spending to generate returns over time, and many sustainability initiatives look exactly like that, Mennel said.
However, there is a vital exception, according to Konferowicz. If a company is subject to a regulatory mandate, it may pursue initiatives even if they do not meet traditional investment hurdles, because compliance and risk reduction become overriding factors.
CFOs can also shape outcomes for responsible procurement. Budgeting standards can steer organizations toward more sustainable purchasing decisions, including hardware lifecycle choices and contract terms that require better supplier transparency. CFOs can also push for procurement language that links sustainability to performance, such as service-level agreements.
CFOs often participate in technology governance structures, which shape how sustainability-related technology risk is managed, Mennel said. He pointed to the EU's Corporate Sustainability Reporting Directive (CSRD) and its double materiality concept, which requires companies to assess both their impact on the climate and the climate's impact on the company.
"That view can change what risks show up in the risk matrix," he said. "Companies think about hardening key manufacturing sites but might not think about warehousing or distribution."
With the CFO at the helm, sustainability strategies can provide even more economic benefits to businesses.
IT's role in building trusted ESG data
The CFO-ESG reporting relationship ultimately hinges on data quality. CFOs need numbers they can defend.
"I have never met a CFO who is not worried about data quality," Konferowicz said. "There is always concern about one number being wrong and the downstream effect."
Completeness gaps often start with basic inventories. Organizations often struggle to build complete real estate and vehicle inventories, mainly when subsidiaries and international units operate on different systems with different controls, Montalbano said.
"Companies come in confident with a building list, but you look at it, and utility invoices exist for locations not on the list," he said.
Those gaps create financial and legal risk for organizations' sustainability claims. Renewable energy and carbon neutrality claims can be especially challenging because they require careful accounting of energy attribute credits, as well as regional and time-based limitations, Montalbano said.
For CIOs, the work is both technical and operational. ESG reporting often draws on a mix of systems, including ERP data, procurement systems, facilities management, cloud management data and supplier reporting. In some organizations, it also includes IoT data streams that track energy use, equipment performance and asset lifecycle details.
The goal is to have no gap between the quality and auditability of sustainability and financial data, according to Mennel. The gap today is maturity: Financial reporting data has been collected, controlled and audited for decades, while many sustainability datasets have not.
"What finance is trying to do, often with advisors, is identify and close gaps," Mennel said.
Aligning governance with reporting frameworks is part of that maturity curve. Multinational companies may have to align data governance and controls across SEC-related expectations, CSRD requirements and International Sustainability Standards Board-based reporting used in markets such as Australia and Japan, Mennel said. In the U.S., state and local rules can also pose operational and compliance risks.
Metrics to track
CFOs gravitate toward metrics that are comparable, defensible and connected to financial impacts. The most straightforward and powerful metric is the carbon footprint, measured in tons of carbon dioxide equivalents, Mennel said.
CIOs who support finance-led sustainability initiatives could benefit from metrics that connect technology decisions to cost, risk and emissions. Examples include the following:
Carbon per cloud workload, paired with data center and cloud spend.
IT asset lifecycle financial impact, including refresh cycles, maintenance costs and end-of-life disposition.
Scope 3 vendor transparency measures, including supplier emissions reporting coverage and sourcing metrics.
Efficiency KPIs tied to cost avoidance, including energy use reduction, cooling optimization and e-waste reduction.
CFOs tend to look for a holistic business case rather than standalone sustainability numbers, Konferowicz said. ESG's impact becomes another factor in evaluating whether an initiative's benefits outweigh its risks.
How CIOs can partner with CFOs on sustainability
For CIOs, partnering with the CFO starts with data readiness and continues through governance, procurement and investment framing.
Key steps CIOs can take to work with CFOs include the following:
Build a thorough sustainability data infrastructure that can deliver financial-grade quality.
Frame sustainability investments in terms of business value, so the CFO can compare them using a common framework.
Track emerging technologies and run experiments that help the business understand what is possible, including how AI and sensor data can support monitoring and decision-making.
Identify data owners, document and strengthen controls, and work toward unifying data into a common schema across regions and subsidiaries.
"From a practical perspective, it is ensuring ready access and ideally unifying data that is in different systems to a common schema," Montalbano said.
All sources pointed to the same underlying pitfall: treating ESG reporting as a checkbox exercise rather than a finance-grade reporting discipline. The most common mistake is focusing on the end result, such as a table in a disclosure, instead of building a process that holds up under scrutiny and fits into the CFO's workflow, Konferowicz said.
For CFOs, sustainability leadership means owning the numbers and decisions behind them. For CIOs, it means making those numbers trustworthy, timely and connected to how the business runs.
Christine Campbell is a freelance writer specializing in business and B2B technology.
