A growing number of companies are committed to policies to ensure environmental, social and governance sustainability — but some remain skeptical about their benefits, according to a new report from the Economist Intelligence Unit.
New Business Models: Shared value in the 21st century, commissioned by Enel Foundation, finds that 66 percent of companies believe there is a direct link between sustainability and long-term financial performance. More managers also understand the wider importance of sustainability and increasing efforts to embed it into their strategies.
The report also shows an increasing minority of business managers who do not believe there is a link between sustainability and long-term financial performance. This has reached 11 percent — an uptick from 6 percent in a similar survey carried out in 2011. More managers also claim they are facing “sustainability obstacles” in their business, with 52 percent saying immediate financial goals take precedence over long-term sustainability.
A separate study released last week found that nearly nine in ten (86%) current European CEOs and future business leaders believe businesses should have a social purpose, but just a fifth of the younger generation agrees they are doing so. Conducted by Coca-Cola Enterprises (CCE) in partnership with Cranfield’s Doughty Centre for Corporate Responsibility and The Financial Times’ FT Remark (FT), Combining Profit and Purpose is based on the views of 50 CEOs and almost 150 MBA and MSc students and recent graduates across Europe. The research indicates that both current and future leaders agree that a business’ profit and the ability to provide shareholder value are the best barometers of business success today.
A Data-Driven Approach to Crafting Messaging That Matters
Join us as Eastman and Herbal Essences share insights from their packaging partnership that leverages molecular recycling to keep waste out of landfills while authentically connecting with consumers on sustainable behaviors — Tuesday, Oct. 17, at SB'23 San Diego.
However, the groups disagree on how that may change in the future. While the overwhelming majority of current CEOs feel that profitability and shareholder value will remain key in the future (94% and 88%, respectively), the findings suggest future leaders have higher expectations of the role business should play, claiming that societal and environmental impact (80%), innovation (61%) and development of future talent (57%) will be more important indicators of business success in the years to come.
Last year, twenty-nine of the world’s leading CEOs and companies joined CECP, a coalition of CEOs united in the belief that societal improvement is an essential measure of business performance, founded in 1999 by actor Paul Newman. These CEOs and companies work with CECP to elevate their societal investment strategies and connect them to their core business, as they are a direct line to employee engagement, innovation, customers, new markets, stronger brands and sustainability, as well as mitigating risk and building trust.