Only around one in four senior business executives report that they have access to high quality sustainability data, and nearly 60% anticipate difficulty complying with new sustainability reporting regulations, while nearly all agree that sustainability is crucial to the success of their organizations, according to a new survey conducted by CRM solutions provider Salesforce, in partnership with insights and advisory consultancy GlobeScan.
For the study, “Sustainable Value Creation: Closing the Gap Between Stated Commitments and Operational Realities,” Salesforce and GlobeScan surveyed more than 230 senior professionals across North America, Europe, Asia Pacific and other regions and a broad range of industries, in functions including finance, information technology and sustainability, assessing their views on sustainability as a driver of value creation, as well as the progress made and barriers to sustainability integration. The report was co-authored by University of Oxford Professor Robert Eccles and NYU Stern Professor Alison Taylor.
The study found that while 90% of executives viewed sustainability as important to their organizations’ commercial success, including two-thirds who rate it as “very important,” only 37% consider sustainability to be very integrated into their businesses. The report highlights several key factors limiting progress on sustainability, including data, a lack of collaboration with finance and technology, limited capital allocation, and perceptions of value creation.
Suzanne DiBianca, EVP and Chief Impact Officer at Salesforce, said:
“Leaders are recognizing that sustainability can be a driver of long-term business resilience and success, but there is a major gap between ambition and action.”
According to the survey, while 95% of respondents agreed that high quality data is important to realize the value of sustainability initiatives, only 27% reported having high quality sustainability data, including only 8% with “very high quality” data. The executives indicated that most companies are working to address this issue, with 63% reporting that they have increased funding for sustainability data collection and management solutions over the past two years, and 65% planning to do so over the next two years.
The report noted the importance of high quality data for meeting new regulatory sustainability reporting requirements, with the survey finding that 59% of executives expect to have difficulty complying with the new EU Corporate Sustainability Reporting Directive (CSRD), and 31% expecting challenges with the reporting requirements from the IFRS’ International Sustainability Standards Board (ISSB).
The study also found gaps in the integration between organizations’ finance and technology departments and their sustainability leaders. While 86% of respondents said that they view the finance function as important to making progress on sustainability, and 75% reported the same for technology, less than a third (29%) reported a high level of collaboration between finance and sustainability, and only 14% between technology and sustainability. The executives did report some improvements in this area, however, with 69% reporting more collaboration with finance, and 63% reporting more with technology, over the past two years.
Despite the perceived importance of sustainability to business success indicated by the survey, the report found a significant gap in resources directed towards sustainability, with only 23% of respondents reporting high capital and resource allocation to deliver on sustainability priorities, including risks, opportunities and impacts.
“Our results sadly show that despite all the happy talk about the importance of sustainability, senior management teams aren’t giving it the attention and resources it needs to really contribute to value creation. Companies either need to dial back their claims about the benefits of their sustainability initiatives or face this challenge head-on with more senior management commitment and capital to facilitate greater cross-functional integration and improved data on sustainability performance metrics.”
One of the key barriers indicated by the report that may be holding back greater sustainability integration and capital allocation was perceptions of the value of sustainability, with leaders reporting a greater impact in areas not directly affecting the bottom line. For example, while 73% of respondents perceived sustainability as having a high or very high value in enhancing brand and reputation, and 67% in strengthening stakeholder and community relations, only half said the same for growing sales, and 45% for attracting more investment.
“There is a clear lack of ownership of corporate sustainability efforts, and a tendency to treat them solely as a brand building strategy. But the imperative today is meaningful cross-functional collaboration, and of course allocating capital toward these critical initiatives.”
Click here to access the report.