As we will be devoting the majority of this course to understanding how we can innovate and leverage opportunities in sustainability, I would like to take this section to provide two readings examining correlations between high performing sustainability programs, increased organizational profitability over peers, and leading management processes.
The Business of Sustainability: Imperatives, Advantages and Actions [1]
The first reading is jointly authored by The Boston Consulting Group and MIT Sloan Management Review, and reflects survey results from more than 1500 executives and high-level managers, and in-depth interviews with more than 50 thought leaders. It has quite a few interesting insights into sustainability's benefits to the business model and profitability, but below is one which nicely illustrates the ties between shareholder return and sustainability efforts.
This is a shorter piece, centered on one, rather in-depth analysis of long-term performance. RobecoSAM, the auditing firm known for its international Sustainability Yearbook [4] rankings, examined the sustainability profile of more than 500 companies a year over a 13-year dataset to create a five-level tier of their approach to sustainability. From Leader to Laggard, they then evaluated the financial performance of those companies over the same period. Below is a central finding of that research:
Links
[1] https://www.e-education.psu.edu/ba850/sites/www.e-education.psu.edu.ba850/files/Lesson2/Boston%20Consulting%20The%20Business%20of%20Sustainability.pdf
[2] https://sloanreview.mit.edu/projects/the-business-of-sustainability/#chapter-5
[3] https://www.e-education.psu.edu/ba850/sites/www.e-education.psu.edu.ba850/files/Lesson3/Alpha_from_Sustainability_06_2014.pdf
[4] https://www.spglobal.com/esg/csa/yearbook/