The recently published MIT Sloane Management Review/Boston Consulting Group study, “Sustainability: The “Embracers” Seize Advantage,” reports that 70% of a broad survey of companies plan to invest more money and devote additional management attention to sustainability in 2011. These companies say sustainability is key to long-term viability and competitiveness, and the concepts they are mainly talking about include resource efficiency, waste reduction, renewable energy, supply chain management, and corporate governance programs. Most companies are convinced there is a “business case” for sustainability considerations.
Market participants and observers say business forces are driving this phenomenon, which has held strong despite the economic downturn: first and foremost, companies that have made sustainability important to their agendas are often high-performers that seek to establish a reputation as innovators and leaders, and to make sustainability part of their “brand” for competitive advantage. Principal audiences for this message are shareholders and potential investors, regulators, lenders, customers, and the media. For some industries, this is especially sensitive: the investor/environmental group network Ceres reports, for example, that oil, coal, and power companies saw a 50% increase this year in shareholder resolutions demanding disclosures and action in the areas of climate change and environmental concerns. But the MIT Sloan Management Review report suggests higher investment in sustainability is occurring in a broad spectrum of sectors, including commodities, chemicals, consumer products, industrial goods, and conglomerates.
At a time of dramatically rising oil prices, the value of taking measures to increase energy efficiency, perhaps the least common denominator of sustainability, is obvious to anyone. But business motivations for going much further into the realm of sustainability are making more and more sense to a growing number of U.S. and international companies. This is clearly a trend to watch.
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