ESG in the Boardroom and on the Balance Sheet
Accountable leadership: How Randy Oostra and Eugene Woods champion ESG
To meaningfully implement ESG principles, healthcare organizations must have support from the top. The culture shift, investments and significant operational changes required to support ESG can only be achieved if those at the helm are champions of the effort.
Eugene Woods, president and CEO of Charlotte, N.C.-based Atrium Health, and Randy Oostra, the recently retired CEO of ProMedica, based in Toledo, Ohio, are two healthcare leaders strongly advocating for ESG adoption across the industry.
At Modern Healthcare Custom Media’s recent ESG Summit: The New Imperative event in Chicago, Woods and Oostra were part of the closing keynote panel moderated by Modern Healthcare Editor Mary Ellen Podmolik. Throughout the discussion, they stressed the importance for healthcare organizations to adopt an ESG strategy, how ESG is helping with recruitment and retention and what progress is being made toward environmental sustainability and health equity. Below is an edited transcript. Editor’s note: This discussion occurred prior to Randy Oostra’s Oct. 31, 2022, retirement as CEO of ProMedica and prior to the merger of Advocate Aurora Health and Atrium Health where Eugene Woods was named co-CEO with Jim Skogsbergh of Advocate Health.
Mary Ellen Podmolik: You both were leaders in ESG before it became a buzz term. How did you start that journey, and where are you now?
Eugene Woods: All of us have our own origin story of what motivates us. My kids and the mission of the organization are what’s driving me. I’ve been with Atrium Health for six years or so. When I first got there, I walked the halls and listened to what was on people’s minds and what they aspired to do. That led us to change the mission statement. Our mission statement is (now) to improve health, elevate hope and advance healing – for all. That has informed our strategies, tactics and culture.
I’ll give you an example. At Atrium Health, we are mapping all the food deserts and the medical deserts that exist in our communities. And we discovered there is a local community that’s about 90% Latinx, and they had no care. So, earlier this year, we opened a clinic there. A young woman who had recently come to this country delivered her baby, and she didn’t know where to go afterward. The social worker connected her with our clinic — we got her housing, and her child had some medical issues that we resolved.
ESG is about impacting communities and impacting real people — that’s what inspires me.
Randy Oostra: Thirteen years ago, ProMedica’s board decided to do something about obesity. A foundation gave the organization $400,000 to create learning (programs) for kids. ProMedica hired trainers and put them into schools and Boys and Girls Clubs, all around the community. After about 90 days, the trainers wanted to meet. We thought we’d hear all these great things. And they said, “We have a problem. These kids are hungry. How can we talk to them about eating healthy when (their parents) are struggling to put food on the table?”
That’s when the light bulb came on: ProMedica started screening for food insecurity. As of today, the organization has screened about 6 million patients for food insecurity, and then that morphed into screening for all the social determinants of health.
That’s the journey ProMedica has been on — trying to figure out what the organization can do and should do.
Podmolik: How much do you consider ESG initiatives to be a recruiting tool?
Oostra: If you look at the Edelman Trust index that came out lately, for the first time ever, people are looking at business to make societal change. That’s healthcare organizations. When physicians and others come work for ProMedica, they love the work the organization has done in social determinants. People want to work for those types of organizations.
Podmolik: Eugene, are you seeing the same thing?
Woods: It was three years ago when, for the first time, we had more (teammates who were) millennials than baby boomers. Now, we know that different generations respond to different types of messaging. For instance, about 75% of millennials will change their buying behavior for something that’s more sustainable.
At Atrium Health, we have an intense focus on providing care outside our walls. But our board chair asked, about two or three years ago, “Are you applying the same community focus inside the organization?” That led us to ask, “What don’t we know about the challenges our own teammates are going through?” We did a survey asking about affordability, hunger and housing security. Now we know what our teammates are struggling with. That’s the culture that ultimately helps with retention, including with millennials because they care about how you are taking care of (their colleagues).
Podmolik: Randy, did ProMedica use the same playbook for addressing social determinants of health in the ESG rollout?
Oostra: It’s the same process. ProMedica started with a small group of people that are very passionate. Make sure that your management knows it’s a priority and they know you’re going to take it seriously. Then, it’s about keeping goals in front of people.
Woods: At Atrium Health, we’re learning if you have the right conversations with smart people that care about the same things, you can be very creative. For example, nitrous oxide piping emits 300 times more emissions of carbon than CO2. When we explain that to the anesthesiologists, the surgeons and the nurses, they’re making the active decision, saying, “Then, let’s not do that. Let’s figure out alternatives.” In that particular case, we’ll save about a million dollars. That said, in many instances, there are no savings that are immediate. So, I don’t want to minimize the challenge that all of us face.
Podmolik: What’s the ultimate benefit of ESG in terms of community health?
Oostra: Just look at the stats. Anytime there’s a tragedy in the world, whether it’s a hurricane, a fire — look at the impact on people. Sometimes they’ve lost their home, (acquired) respiratory illnesses, or (experienced) hunger. It’s a very significant healthcare issue. For healthcare leaders to say, “We’re not going to do anything about it, we’re going to ignore it, we’re not going to be passionate about it,” it just doesn’t make any sense.
Woods: As a healthcare system, we contribute to the problem. I don’t think any of us can avoid leading our organizations in this direction, even though we don’t know all the answers. We just have to put one foot in front of another and march toward that goal of a sustainable planet that our grandchildren and great-grandchildren can be on and be healthy.
Podmolik:Will the healthcare system look markedly different in 20 or 30 years as a result of these kinds of initiatives?
Woods: It depends on what we do today. Systems are at different stages of the ability to really do something now. The reality is that this requires investments, and returns on investment are not immediate. That was part of the conversation that we had at the White House — they need to continue to drive incentives and realign the way they pay health systems to make sure that there is an incentive to do this, especially for those that are having more challenges.
Oostra: Healthcare is not affordable. Everyone calls it personal bankruptcy. We’ve known this for 50 years. Now, the healthcare industry is knocking on the door of 20% of the GDP. What you hope is (healthcare will be) very, very different five years from now.
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