Corporate professionals are acknowledging the role of sustainability in business. The recently published 2016 State of Responsible Business Report, which surveyed more than 2,000 professional around the world, found that 86 percent of corporate participants agree that “sustainability is becoming an increasingly important part of business strategy.” Meanwhile, over 70 percent “of corporate CEOs are convinced of the value of sustainability.”
This isn’t that surprising, given that companies like BMW, Adidas and Coca-Cola have sustainability initiatives. What is more insightful is that nearly half of corporate respondents “either ‘don’t know’ or ‘don’t believe’ sustainability is driving revenue for their business.”
“The majority of respondents are still struggling to accurately measure the ROI of sustainability activities and very few budgets are increasing,” said Liam Dowd, Managing Director of Ethical Corporation (the company that released the report).
Companies with complex supply chains, such as those dealing in clothing, food and beverages or manufacturing, were most likely to acknowledge the financial benefits of sustainability. Fifty two percent of respondents from those industries said they paid for outside sustainability consultants.
One way to increase ROI on corporate sustainability projects is to market an eco-friendly corporate ethos. A 2014 international study found that 55 percent of consumer respondents said they would “pay more for products and services provided by companies that are committed to positive social and environmental impact.” Of note, over 62 percent of participants from Asia, Latin America and the Middle East stated a willingness to pay more, whereas less than 43 percent of respondents from North America and Europe said the same.
Some progressive companies are looking beyond ROI for business success. As Michael Bloomberg recently tweeted, “If you can’t measure it, you can’t manage it and you can’t fix it.”
Following that sentiment, companies are using various alternative metric systems, like Social Return on Investment, to measure social and environmental returns. Findings from this report indicate that many corporations are beginning to incorporate sustainability practices into business operations and there is a long way to go (if it’s possible at all) before our planet can produce and consume in a fully sustainable fashion.