Sustainability’s role in business performance
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But it can also be a path to increased profitability and competitiveness. Think of it as first-mover advantage: companies that act bigger and faster on sustainability are performing better. Meanwhile, time is running out on a fast-follower strategy.
Our survey respondents illuminate the way forward for companies looking to scale their sustainability efforts—and their performance. Learn more by reading our findings.
Top categories of findings
Investment reasons
Regulation is driving sustainability. But so is the impression companies leave on the world.
Regulations win out, but companies are also becoming self-conscious: societal approval and reputation rank highly.
Motivators
Respondents see revenue and profit opportunities in sustainability, but the commitment of top leadership and the board matter more.
Sustainability is driven from the top—leaders are pushing their organizations to act.
Barriers
The fit between sustainability and the business's objectives and results is not as clear as businesses would like.
Uncertainty about embedding sustainability into the business runs high, as does alignment with strategy and ROI.
Data quality
Respondents are frustrated with sustainability data.
Only 21% say they are completely satisfied with the quality of their environmental sustainability data.
Data dissatisfaction drivers
When data is difficult to work with, insights wither.
Respondents are concerned about their data completeness, scope, collection frequency, and understanding the calculations behind it.
Financial materiality
The perception of sustainability’s financial effects plays an important role in the actions companies take.
Most companies don’t see sustainability as financially material now, but a minority do – and they are seeing more success
Impact on profitability
Companies overwhelmingly recognize that sustainability is intertwined with their bottom line.
80% see a positive relationship with long-term profitability.
Impact on competitiveness
Companies see a strong link between sustainability and their long-term competitive advantage.
71% see a positive relationship with long-term competitiveness.
Investment priority areas
Investing to stop climate change matters most, but when grouped with the other top priorities, a holistic strategy emerges.
The high ranking of materials use, solid waste, and resource availability reflects circular economy thinking.
Reporting standards
Respondents are struggling to find third-party sustainability reporting standards that are most relevant to how they do business.
When it comes to monitoring and reporting environmental sustainability, many companies develop their metrics themselves.
Measurement methods
Most companies rely on estimates and calculations rather than sensor data.
Across all environmental issues, most companies (37%) are using assumptions and estimates to collect data.
External reporting methods
Nearly everyone is telling the world about their sustainability actions.
The popularity of dedicated reports means companies (and their investors) are taking sustainability seriously.
Impact on strategic and operational decisions
If you aren’t thinking about sustainability in strategic and operational terms, you’re in the minority.
75% of respondents use environmental sustainability data as an important piece of their strategic and operational decisions.
The balance sheet blind spot
Companies expect environmental sustainability to positively affect business performance, an SAP Insights study found.