Most Companies Fail to Embrace Sustainability: Report

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LONDON, UK -- By and large, companies are a long way from taking sustainability seriously and fail to grasp the opportunities it presents, according to a new report.

“Sustainable Performance” from Arthur D. Little argues that regulatory and consumer pressures have not pushed corporations toward sustainability beyond superficial measures. International investors, however, are proving to be a driving force in nudging corporations to embrace the concept.

“Our research has shown that there are clear signs that a powerful force that does have the ability to effect a rapid and deep-rooted change in corporate behaviour is emerging and the international investor community now recognises that those companies that are able to derive value from sustainability will outperform their peers financially in the long run,” said Annette Malmberg, a senior manager in Arthur D. Little's Energy, Utilities, Strategy and Organization Practice.

The result is that sustainable performance drivers and shareholder economic interest are aligning, she said.

“Also, sustainable performance and effective carbon management allow companies to create economic value by enabling them to demonstrate superior management skills and become more competitive by offering environmentally superior products and services,” she said.

According to the report, even Nordic companies -- often perceived as being ahead of the curve in terms of environmental issues -- fail to take advantage of the opportunities presented by sustainability. Overall, the report said, companies pay attention to sustainability issues only when they impact the bottom line. However, companies listed on several sustainability indices tend to outperform their peers.

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