Published on November 9, 2023, 4:06 am
A recent survey conducted by Gartner has revealed that an overwhelming 87% of business leaders are planning to increase their investment in sustainability over the next two years. This growing focus on sustainability is being driven primarily by customers, with 80% of executives identifying them as the stakeholder group exerting pressure on organizations to take action. Investors and regulators were also mentioned, with 60% and 55% of respondents respectively recognizing their influence.
According to Kristin Moyer, a distinguished VP analyst at Gartner, sustainability is becoming increasingly essential for businesses to cope with disruption. Economic uncertainty, geopolitical conflicts, and rising costs of materials and energy have compelled organizations to reevaluate their expenditures in order to ensure resilience. Moreover, Moyer emphasizes that this shift towards sustainability presents new opportunities for enterprises to grow while mitigating costs and risks.
The survey included responses from 221 executives in director roles or above across North America, Europe, and Asia/Pacific. These respondents were selected from organizations with enterprise-wide annual revenues of at least US$250 million for the fiscal year 2021, demonstrating a commitment to sustainability-related activities.
One notable finding from the survey is that 86% of business leaders view sustainability as an investment that safeguards their organization from disruptions. Additionally, 83% of respondents stated that sustainability initiatives directly create both short- and long-term value for their organization. This aligns with the belief held by 80% of participants that sustainable practices help optimize and reduce costs within their organizations.
The survey also identified specific areas where sustainability programs are seen as effective in mitigating cost increases—namely energy consumption, business travel, and customer transactions.
Moyer explains that executive leaders have been able to achieve both operational and supply chain savings through their sustainability programs. The synergy between sustainability investments and business goals like cost optimization leads to a significant impact on these programs by creating a virtuous cycle known as “two for one.”
Beyond cost savings, sustainability can also foster growth and innovation. The survey found that 57% of business leaders see a strong connection between their enterprise’s sustainability program and the income statement. Furthermore, 42% of respondents are leveraging their sustainability activities to drive innovation, differentiation, and enterprise growth through the development of sustainable products.
However, Moyer advises caution against greenwashing risks and emphasizes the need for genuine efforts in sustainable growth. She recommends focusing on product attributes that resonate with customers and shape their buying decisions. When approached strategically, sustainability can provide businesses with a competitive advantage even in challenging market conditions.
In conclusion, business leaders recognize the importance of sustainability as a means to protect their organizations from disruption. This survey conducted by Gartner highlights the growing commitment to investing in sustainability initiatives among executives worldwide. By aligning with stakeholder expectations and capitalizing on growth opportunities, businesses can not only mitigate risk but also drive innovation and differentiate themselves in the marketplace.