Execs won over by business case for sustainable investment

Majority of business managers believe benefits from green initiatives now outweigh costs

Over half of business managers now accept the commercial case for green investments and initiatives, according to a new global survey of over 1,200 senior executives from the Economist Intelligence Unit.

The Doing Good: Business and Sustainability Challenge survey found that 57 per cent of respondents believed the benefits of investing in green initiatives outweighed the cost, while a majority expected green investments to turn a profit.

The findings suggest that growing numbers of business leaders now accept the conclusions of the raft of recent reports suggesting a correlation between environmental and financial performance.

Quoted in the report, Ed Potter, director of global workplace rights at Coca-Cola, said that while no study had established a connection "in accounting terms" between a firm's green credentials and financial performance there is now a widespread belief that "there is a clear connection".

The Economist's study further adds the growing body of evidence supporting a link between sustainability practices and financial and share price performance.

It found that those "share price climbers" which boast growth in excess over 50 per cent over the past three years, put emphasis on environmental initiatives at board level and in nearly 40 per cent had sought to reduce green house gases.

In contrast, "share price losers" that have seen their share price decline by more than 10 per cent in the past three years, where two and half more times likely to have nobody in charge of sustainability than those firms' with climbing share prices.

Bjorn Stigson, president of the World Business Council for Sustainable Development, said that with intangible assets such as brand and reputation increasingly influential factors in a firms share price performance the business case for sustainable investments and policies was strengthening.