Businesses wake up to financial benefits of sustainability
The advantages of running a strong corporate social responsibility (CSR) programme are becoming more tangible for businesses, with cost management emerging as the number one driver for firms looking to adopt more sustainable businesses practices.
That's according to a new survey of more than 2,500 business leaders from consultancy Grant Thornton, which discovered that more than half (57%) of respondents now view integrated sustainability reporting is 'best practice' within their organisation. (Scroll down to download report).
When asked about the key factors that provoke the move towards becoming more environmentally and socially sustainable, 67% of organisations said cost management was the most important driver, followed by customer demand (64%) and simply 'because it's the right thing to do' (62%).
Writing in the foreword of the report, Grant Thornton's global leader for strategic development and growth Paul Raleigh said: "Companies which boost profits at the expense of the local population or natural environment can find demand for their products and services drying up in the face of a press or social media storm.
"The leadership of dynamic businesses towards more socially responsible and transparent practices is likely to emerge as a competitive edge to unlock their potential for growth in an ever more crowded marketplace."
The significance of cost management for businesses looking to become more sustainable has risen by an average of 11% across the 34 economies featured in this report, since the last version in 2011. The increase is particularly notable in the US, with 77% of businesses now citing cost management as a key sustainability driver - a rise of 35% over the past three years.
The survey goes on to look at the range of activities businesses are undertaking to reduce the social and/or environmental impact of their operations. It found that the majority (68%) are involved in charities or local causes in some way, with firms in the US - where philanthropy is deeply ingrained in the culture - clear global leaders in this area (93% donated money to local causes).
Initiatives that improve energy efficiency or waste management have been carried out by 65% of businesses over the past year. However, the report also found that just 31% of firms have calculated their carbon footprint, while 25% have changed specific products or services to reduce their environmental impact over the past 12 months.
Despite the vast majority of businesses engaging in sustainability initiatives, the Grant Thornton report concludes that few firms actually report on this activity. Globally, just 31% of businesses report on the sustainability of their operations (alongside financials), a slight rise from 2011 (25%).
Raleigh added: "This approach, which we fully support, should enable more effective decision making at board level, improve investor information and encourage deeper dialogue about the impact of businesses practices."