Sustainability: The ‘Embracers’ Seize Advantage

by: Knut Haanaes, David Arthur, Balu Balagopal, Ming Teck Kong, Martin Reeves, Ingrid Velken, Michael S. Hopkins, and Nina Kruschwitz

A Sweet Spot on the Adoption Curve?

While global economic and political factors might have predicted otherwise, corporate commitments to sustainability-driven management are strengthening.

But even as enterprises overall are strengthening their commitments, one cohort of organizations is expanding its commitments far more aggressively than others — and a gap has emerged between sustainability strategy leaders (“embracers”) and laggards (“cautious adopters”).

Those are among the key findings yielded by the second annual Sustainability & Innovation survey of global corporate leaders — a collaborative study by The Boston Consulting Group and MIT Sloan Management Review. How are organizations responding to the challenges and opportunities of sustainability? How are the terms of competition shifting — or not shifting — in the face of sustainability concerns? How is cutting-edge management practice being transformed as a consequence? Those are the questions explored in this study, through both the global survey and a series of in-depth research interviews with thought leaders and business executives. This report contains the study’s results.

The discovery of broad-based growth in sustainability-related investments is explained in part by further findings that companies increasingly believe sustainability will become a source of advantage, should be incorporated strategically in all aspects of a business’s operations and eventually will require a sea change in competitive behavior. “We need to integrate sustainability, not as a layer, but in the fabric of the business,” argues Katie Harper, manager, sustainable supply chains at Sears Canada, voicing a common view.

“The only way to continue growing and continue being a successful business is to treat sustainability as a key business lever in the same way that you treat marketing, finance, culture, HR or supply chain,” says Santiago Gowland, vice president of brand and global corporate responsibility at Unilever. “So really it’s core to the ability of the business to grow.”

While the survey revealed that most companies view sustainability as eventually becoming “core,” what’s more interesting is the revelation that one camp of businesses — the embracers — is acting on the belief that it is core already.

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