The latest EY Sustainable Value Study finds that companies acting on climate change realize above-expected returns across five sources of value.

According to Steve Varley, EY Global Vice Chair – Sustainability, climate change is everybody’s business. “While government delegates from around the world meet at COP27 to deliberate on how the world can slow climate change, the private sector has a role to play, too.

Companies have almost universally accepted this fact. Our survey of more than 500 companies leading on sustainability finds that 93% have made public climate commitments. In spite of that, progress remains too slow to deliver the emissions curbs the world needs.”

Yet companies that take decisive climate action do not just create more value for the planet, they also capture more financial value for themselves on measures such as revenue growth and earnings. At the global EY organization, says Varley, “we call this value-led sustainability. More than two-thirds of all respondents — 69% — report that they capture higher financial value than expected from their climate initiatives.”

He adds that “this challenges the perception that there is a trade-off between financial and nonfinancial impact. To the contrary, for a subset of ‘pacesetter’ companies taking the boldest steps, comprehensive climate action helped boost customer value (such as brand perception and purchasing behavior) as well as employee value (such as staff recruitment and retention), which in turn led to improved financial value. These pacesetters are 2.4 times more likely than companies taking few climate actions (observers) to report significantly higher-than-expected financial value as a result of their climate initiatives. They’ve also achieved higher emissions reductions to-date.”

By putting climate action at the heart of business strategy, Varley believes that value is delivered across a range of vital measures. “The sooner companies get started, the more they learn and the more value they receive. What’s good for the planet is also good for business.”

For more, please go to How can slowing climate change accelerate your financial performance? | EY - Global.