Sustainability integration accelerates value creation, ERM finds

While the majority of firms believe sustainability actions can yield major operational advantages. However, according to a new study, just one-third of firms have actually fully integrated sustainability actions into their businesses.

In 2024, a pioneering new research partnership was announced, bringing together five leading organisations specialising in advancing enterprise-wide value creation based on sustainability. The Sustainability Value Creation partnership involves Accounting for Sustainability, SustainableIT.org, Salesforce, GlobeScan, and the ERM Sustainability Institute – and aims to accelerate how companies can most effectively integrate sustainability across their corporate finance, technology, and sustainability functions to drive long-term value.

To help highlight best practices, and highlight areas of opportunity or weakness, the coalition have committed to researching the sustainability efforts of the world’s largest companies. The latest study from the group took in the opinions of from 320 senior executives across corporate finance, IT, and sustainability functions – and highlight a growing urgency to demonstrate sustainability’s business impact.

The majority of firms believe that businesses where sustainability is well-integrated into operations reap rewards on multiple fronts. With success driven by the effective collaboration of sustainability, finance, these integrated firms can identify the biggest opportunities, size their financial impact, and automate the meaningful data needed for effective decision-making.

This means that while there are some fairly expected fronts on which sustainability is perceived as ‘very high value’, there are a number of places where it is much more important than might have traditionally been thought. Sustainability actions are seen as a plus for brand reputation by 74% of respondents, and as more and more consumers base their choices on sustainability, that has become a common assumption. But leaders also recognise the opportunities sustainability brings in several less obvious places.

For example, 62% said sustainability actions could drive innovation – finding quicker, more efficient and ultimately cheaper way of operating their businesses in the process. Meanwhile, 49% said this could help to grow sales, and 47% said it could also help attract investment. As a result, 66% of companies agree that integrating sustainability into their businesses is very important – roughly the same as in 2024. But despite that perceived value, comparatively few businesses seem to be acting on it.

The researchers found that in 2024, only 37% of businesses felt their sustainability efforts were “very integrated” into their firms – and a year on, that figure is unchanged. This leaves a significant gap between what businesses say about sustainability, and their actions. This might not come as a particular surprise, depending on who is asked – but according to the researchers, there is much more at stake here for businesses than the optics of broken promises.

This gap is holding back value creation. The study compared the 37% of companies that have successfully integrated sustainability into the core of their organisation, with the rest of the respondents. In doing so, they identified a marked difference in performance, with advanced integrators consistently realising more value than less-advanced integrators across 12 different areas of value creation.

“Learning from their differences will help all companies identify how to create more value,” the researchers noted. “Integration is critically important in driving value on sustainability, often formalised by structurally embedding sustainability considerations, guidelines, standards, and targets into policies, principles, and procedures, including management reporting and governance frameworks.”