According to a new study released, a growing number of CEOs see sustainability as one of the most important challenges to address in the next two to three years.
According to IBM's annual CEO study, "Own Your Impact: Practical Pathways to Transformational Sustainability," which polled over 3,000 CEOs worldwide, nearly half of respondents rank sustainability as a top priority for their organizations, a 37% increase from 2021.
However, more than half (51%) identify sustainability as one of their top challenges in the next two to three years, citing a lack of data insights, unclear ROI, and technological barriers as roadblocks.
While 95% of CEOs say they are at least in the piloting process of implementing their sustainability initiatives, just under a quarter (23%) say they are utilizing their sustainability strategy across their entire organization.
As the world recovers from the coronavirus pandemic, firms are under increasing pressure from stakeholders to prioritize how they will adapt as the world transitions to a low-carbon economy.
According to the report, sustainability was at the top of the list of challenges for 51% of CEOs, up from 32% in 2021, with greater demand for action coming from board members and investors.
Almost half (48%) of CEOs say rising sustainability is one of their top priorities for their company in the next two to three years, up from about a third in 2021. Almost 70% of CEOs polled say they are directly involved in defining their organization's sustainability strategy.
More than 80% of CEOs believe that their company's sustainability investments will improve business results over the next five years, and nearly half (45%) believe that sustainability will accelerate business growth.
The emphasis was also influenced by a growing consensus that corporate sustainability efforts can lead to improved business performance.
Simply put, sustainability is a business strategy for creating long-term value by considering how an organization operates in its ecological, social, and economic environments. The assumption behind sustainability is that developing such strategies promotes company longevity.
Companies are recognizing the need to act on sustainability as corporate responsibility expectations rise and transparency becomes more prevalent.
There is no "one right solution" for sustainability, just as there is no "one right solution" for overall strategy. The best solution is determined by each company's ambitions and stakes. Here are a few actions that all management teams can take to improve their sustainability practices.
To summarize, sustainability is a major challenge that affects more than just individual businesses. However, a reassuring number of large corporations are developing innovative sustainability policies. It is becoming increasingly clear that sustainability is a megatrend that is not going away.
