Environment

Majority of Companies to Increase Sustainability Investment Over Next Two Years

Nov. 28, 2022

In a Gartner survey, 80% of companies said that sustainability helped their organization optimize and reduce costs.

Sustainability continues to be front and center at many companies. A new Gartner, Inc. survey revealed that 87% of business leaders expect to increase their organization’s investment in sustainability over the next two years.

And where are companies feeling the pressure for this investment? Customers are the primary stakeholder group creating pressure for organizations to invest or act on sustainability issues, selected by 80% of executives, followed by investors (60%) and regulators (55%).

“Sustainability enables businesses to cope with disruption,” said Kristin Moyer, distinguished VP analyst, Gartner, in a statement. “Economic uncertainty, geopolitical conflict and escalating materials and energy costs are forcing businesses to reexamine all expenditure forms. This focus on essentialism, in combination with increasing stakeholder desire to see progress on environmental, social and governance (ESG) goals, creates new opportunities for enterprises to grow while mitigating cost and risk.”

Sustainability Protects Organizations from Disruption

The survey found that 86% of business leaders see sustainability as an investment that protects their organization from disruption. Additionally, 83% said sustainability program activities directly created both short- and long-term value for their organization, and 80% indicated that sustainability helped their organization optimize and reduce costs.

Specifically, the top areas where survey respondents said sustainability programs are mitigating cost increases are energy consumption, business travel, and customer transactions.

“Executive leaders are achieving both operational and supply chain savings through their sustainability programs,” said Moyer. “This kind of ‘two for one,’ where sustainability investment supports a business goal like cost optimization, significantly enhances the program’s impact by creating a virtuous cycle.”

Sustainability Drives Growth and Innovation

Sustainability can also enable new value creation and business growth opportunities. Fifty-seven percent of business leaders said the enterprise sustainability program has a strong connection to the results on the income statement, and 42% of respondents are leveraging their sustainability activities to drive innovation, differentiation and enterprise growth through sustainable products.

“Investing in sustainability can support product differentiation but be wary of greenwashing risks – there are no shortcuts to sustainable growth,” said Moyer. “Focus on product attributes that are important to customers and how these priorities shape buying decisions. When viewed through a strategic lens, sustainability can provide a ray of sunshine for businesses during difficult market conditions.”

About the Author

EHS Today Staff

EHS Today's editorial staff includes:

Dave Blanchard, Editor-in-Chief: During his career Dave has led the editorial management of many of Endeavor Business Media's best-known brands, including IndustryWeek, EHS Today, Material Handling & Logistics, Logistics Today, Supply Chain Technology News, and Business Finance. In addition, he serves as senior content director of the annual Safety Leadership Conference. With over 30 years of B2B media experience, Dave literally wrote the book on supply chain management, Supply Chain Management Best Practices (John Wiley & Sons, 2021), which has been translated into several languages and is currently in its third edition. He is a frequent speaker and moderator at major trade shows and conferences, and has won numerous awards for writing and editing. He is a voting member of the jury of the Logistics Hall of Fame, and is a graduate of Northern Illinois University.

Adrienne Selko, Senior Editor: In addition to her roles with EHS Today and the Safety Leadership Conference, Adrienne is also a senior editor at IndustryWeek and has written about many topics, with her current focus on workforce development strategies. She is also a senior editor at Material Handling & Logistics. Previously she was in corporate communications at a medical manufacturing company as well as a large regional bank. She is the author of Do I Have to Wear Garlic Around My Neck?, which made the Cleveland Plain Dealer's best sellers list.

Nicole Stempak, Managing Editor: Nicole Stempak is managing editor of EHS Today and conference content manager of the Safety Leadership Conference.