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Sustainability value management

Stronger metrics to drive differentiation and growth

Overview

Can sustainable and responsible growth drive benefits to both business and society? Skepticism exists among executives and investors alike as to how competitive advantage and growth are actually to be driven from sustainability. This skepticism is largely a matter of measurement and valuation.

The road to compelling sustainability metrics has been a rocky one. Now, however, new valuation approaches are being pioneered to help business executives identify and measure value to business and society, and to inform and steer portfolios of sustainable products and services. Applied consistently, they can foster better decision making and value generation.

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Key Findings

Companies and their investors do not see eye to eye on the business value of sustainability. Why not?

A gap exists between companies and investors in terms of accurate valuation of sustainability initiatives from a business perspective.

  • 57 percent of CEOs say they are able to set out their strategy for seizing opportunities given by sustainability, but only 9 percent of investors share that view.

  • Only 7 percent of investors agree that businesses can accurately quantify the value of their sustainability initiatives

Investors need to place clearer demands on business. At the same time, business needs to demonstrate clearer links between sustainability and corporate value.

Too many companies are overly focused on sustainability risks and their license to operate. Leaders in the area of sustainability instead shift the focus to create upside value for society and shareholders.

Recommendations

Companies need stronger metrics for success, measuring the value to both business and society.

Here’s how to get started:

Identifying sustainability drivers: Map value drivers and set targets that link to commercial value.

Driving the product portfolio: With clear targets and metrics in place, steer and innovate the portfolio to increase profitability and sustainability of products or services.

Embedding metrics across the organization: An essential aspect of sustainability value management is institutionalizing it: embedding it into areas such as governance, workforce and executive behaviours, IT systems and business processes.


Author

Alexander Holst

Alexander Holst
Managing Director - Accenture Strategy

Alexander Holst is a Managing Director for Accenture Strategy and leads the Sustainability Practice in Germany, Austria and Switzerland. He focuses on integrating sustainability aspects into the core business of clients across numerous industries. Alexander Holst has led several strategy project at corporate clients looking at how to value ecological and societal aspects and to capture financial benefits by integrating them into product portfolios, processes, and business models.

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