In late 2022 Verdantix, an independent research firm, conducted a study of 100 operations, real estate and sustainability executives working across industry sectors in regions including the US, Canada, the UK and Australia.
The Verdantix Thought Leadership report finds that while organizations are already incorporating sustainability metrics into decision making and prioritizing specific elements of sustainability, they continue to face hurdles in operationalizing sustainability due to inadequate digital tools and limited data sharing. But how can organizations use operational tools and processes to enable and drive improve sustainability performance?
This report compiles responses and insights from a range of senior level executives across industries. It is a must-read for sustainability, operations and real estate leadership looking to get ahead of the curve and understand what their industry peers are doing to prepare for conducting business in a low carbon economy.
Explore 5 key trends around operationalizing sustainability in 2023
Corporate boards are driving the growing business focus on sustainability
The majority of respondents said the board exerting pressure on business units to improve their financial risk governance was ‘highly influential’ in shaping corporate sustainability strategies. “…this marks a major shift from the early 2010s when getting any sustainability items on board agendas was a major challenge,” the report states.
of respondents said board-level pressure is a highly influential driver for sustainability.
Sustainability metrics are influencing core operational decisions
The report finds that sustainability metrics, ESG reporting and data management are playing a role in shaping operational decisions and investments. Of note is the finding that close to 30% of respondents said that they already embed sustainability metrics into their operations in a way that is on par with financial risk metrics. Investor pressure and sustainability-linked legislation are driving this change in outlook.
see sustainability metrics as influential considerations when taking operational decisions that impact sustainability.
Emissions reporting is among the top three sustainability focus areas for businesses
Emissions reporting, employee wellbeing, and social impact initiatives surfaced as the top three sustainability use cases. As one respondent from a financial services firm summarized, “we need to measure the different scopes to be able to create an action plan going forward and assess if our current investments have a future in light of ESG market trends.”
of executives have a strong or medium focus on emissions reporting
Dependency on basic tech and siloed monitoring are stifling sustainability programs
When it comes to the governance of ESG data capture, the survey found a heavy reliance on traditional tools to measure and address sustainability issues. While many respondents link sustainability performance with the long-term resilience of their businesses, a staggering 70% of respondents said they lack the tools to interpret and operationalize sustainability data. Beyond the lack of digital tools, 67% of respondents said they suffer from siloed decision-making and data collection.
of respondents said they lack the tools to interpret and operationalize sustainability data.
Corporations seek expert support to integrate sustainability into their organizations
While two-thirds of respondents said they seek support in defining their sustainability and clean energy strategies, nearly half also said they require support with delivering voluntary sustainability reports. This need stems from the executive board driving sustainability strategies and the growing demand for more transparent sustainability performance data from investors.
said they are most in need of consulting services for defining sustainability and low carbon transition strategies.
What steps can organizations take to operationalize sustainability?
Based on an in depth analysis of trends identified in the report, Verdantix recommends that organizations do the following to operationalize sustainability:
- Establish a sustainability strategy appropriate to the business before making investments
- Prioritize energy and emissions management projects
- Invest in digital solutions to improve data management
- Embed sustainability into the day to day fabric of the organization