Exclusive: Chief execs confirm sustainability projects are smashing expectations

Nearly three quarters of corporate sustainability projects exceed managers' expectations, according to a major new international survey of 247 C-level executives to be released later today.

The survey, which was undertaken by consultancy Accenture, revealed that 72 per cent of executives in the UK, US and China believe that the benefits of sustainability initiatives exceed expectations, while only four per cent found that they fell short of initial targets.

Almost half of respondents said that sustainability projects had helped to enhance stakeholders' trust in their firm, 42 per cent said that they had resulted in lower costs, and 41 per cent said that they had bolstered their brand equity.

Speaking to BusinessGreen, Bruno Berthon, managing director at Accenture Sustainability Services, said that the developing nature of the economic, social and regulatory factors driving investment in corporate sustainability meant there was a good chance that green business will continue to outstrip managers' expectations.

"All the factors driving this are developing fast," he observed. "For example, if you invested in an energy efficiency project two years ago, the rising price of energy means the benefits could be double what you expected."

Berthon added that, with many sustainability projects at the pilot stage, it was likely that benefits above and beyond the initial goals were likely to be identified.

The research also revealed that sustainability projects had the potential to drive "intangible benefits" across the business.

"A lot of sustainability projects reach across much of the business, and that can bring a lot of good intangible benefits," said Berthon.

"For example, if the marketing and manufacturing teams work together to improve the sustainability of the supply chain that creates an interface within the business where the teams can then work better together on other initiatives."

The survey revealed that sustainability concerns are increasingly regarded as a mainstream business issue by an overwhelming majority of senior executives, with 68 per cent of respondents admitting that they see sustainability as an integrated part of their business, while 93 per cent said that their company currently operates sustainability initiatives.

However, the survey also revealed that a "hard core" of around third of senior executives regard sustainability concerns as "peripheral" to the main business.

Berthon said that those businesses shunning sustainability investments tended to be smaller firms facing pressing short-term commercial challenges. He also argued that there are some markets, particularly in the US, that have an "ideological bias" against sustainability initiatives, despite growing evidence of the commercial benefits that they deliver.

"There are companies that remain very active in lobbying against sustainability legislation and investments and they are driving this resistance," he said. "At the same time there are some markets that still do not see sustainability as a genuinely strategic issue for them."

Intriguingly, the survey also revealed that those businesses undertaking sustainability initiatives are doing so for ethical reasons that are often underplayed by sustainability executives.

While it is widely accepted that businesses launch sustainability initiatives in response to pressure from regulations, customers and investors, the poll found that the top motivation for green projects among executives was "a genuine concern for the environment and society".

Reducing costs, meeting customer expectations, and exploiting new commercial opportunities were also cited as drivers for sustainability projects, but ethical concerns remained the most common motivation for investment.

"There is a clear trend, particularly among big businesses. There's been a view of businesses where absolute profits and shareholder value are the only priority and the rest is not relevant," said Berthon.

"But we are seeing some of that thinking start to change. There is pressure from the new generation of executives for a more balanced definition of the objectives of capitalism."

He added that this still embryonic school of management thinking was hamstrung by the lack of market indicators that reflect sustainability goals, arguing that the next challenge for green businesses was to develop new mechanisms for measuring corporate success that incorporate sustainability as well as financial metrics.