[Editor's note: This is the first installment of WRI's five-part series, "Aligning Profit and Environmental Sustainability." Each post, which will run on Thursdays for the next four weeks, will offer solutions for businesses to better integrate environmental sustainability into their operations.]
Implementing corporate environmental sustainability strategies is increasingly becoming standard practice. More than 300 firms on the S&P 500 index, for example, report their greenhouse gas inventories each year to the Carbon Disclosure Project. Fortune 100 and S&P Global 100 companies are investing billions of dollars to reach renewable energy procurement targets. Some companies are going further and taking steps to reduce the environmental impact of their products, services and supply chains.
Despite this encouraging progress, a confluence of global environmental challenges is putting more pressure on corporate environmental sustainability strategies to get to scale quickly. Not enough global businesses have integrated environmental sustainability into their long-term decision-making. And, as it stands today, existing practices are not enough to protect the natural resources that society and businesses depend on.
WRI examines this gap between existing corporate sustainability practices and the environmental protection needed for the 21st century in our new report, "Aligning Profit and Environmental Sustainability: Stories from Industry." We interviewed sustainability managers from AkzoNobel, Alcoa, Citi, Greif, Johnson & Johnson, Mars, Natura and Siemens to better understand why strategies that are good for both business and the planet are not getting to scale.
We identified four barriers in these discussions, as well as ways companies can overcome them:
1. Improved environmental sustainability is not valued in internal capital allocation decisions
Companies often lack the internal mechanisms to properly value the benefits of managing environmental sustainability, such as reduced exposure to energy price volatility, water risks and other environmental impacts of operations and supply chains.
Next page: Aligning sustainability and finance teams