Nearly 70% of CEOs worldwide value sustainability

21-Apr-2015 - Last updated on 22-Apr-2015 at 14:08 GMT

Related tags United nations Sustainable development

The report said 67% of respondents said sustainability activities had increased their revenue and business.

Nearly seven in ten CEOs worldwide see the value of sustainability but only two out of ten (21%) companies are leveraging the full potential of sustainability practices, says a report.

The Ethical Corporation’s State of Sustainability 2015 survey of 1,474 consultants, corporate managers and green NGO officials revealed that most companies said they were making savings from sustainability initiatives.

However, only around a fifth said their company was fully taking advantage of its potential.

In the first of such surveys by the company, 53% of respondents said they could link increased revenue to sustainability activities, while a higher 67% said such activities had increased their revenue and business.

A further 30% of respondents rated sustainability as a source of competitive advantage as the most important issue facing their company over the next five years.

But a lot more needs to be done by companies to fully operationalise it and understand its impact on revenues, said the report.

“Grappling with these issues will be the key challenge in the year ahead,”said the report

Stepping out of the silo mentality

Additionally, the report found that the sustainability discipline had also changed the silo mentality (where different departments in a company have little idea what another is doing) and had become a core aspect of strategic planning.

“This is especially true for supply chain management – arguably the area of greatest reputational and operational risk for modern multinationals operating in a globalised environment,” said the report.

Global warming and accountability

In September 2015 World leaders are expected to adopt the post-2015 global development agenda, setting poverty reduction and sustainable development goals to be achieved by 2030.

In November, the 21st Session of the Conference of the Parties to the United Nations Framework Convention on Climate Change (COP21) will be held in Paris, with the aim to keep global warming below 2°C.

Businesses will be called on to shoulder much of the burden in delivering the promises made by leaders at these events.

“The degree to which companies are in a position to respond to the call will to a great extent determine their future sustainability,” said the report.

Impact on revenues

The report also highlighted the problem of properly measuring the impact of sustainability initiatives on revenues with only 39% of respondents saying they felt confident that they are evaluating this accurately.

“Clearly there is room for improvement in monitoring of the impacts on the bottom line,” the report said.

Jaguar Land Rover sustainability manager, Ian Ellison the report highlighted that there were powerful levers of change at play. “We can see from the report that the overwhelming majority of us now enjoy: a fully convinced CEO, sustainability as part of our business strategy and some form of reporting into the executive suite. These are powerful levers for change.”