Believing sustainability is at the core of business success, means it’s also at the heart of decision making. A focus on financial performance alone results in important considerations being missed.
In a recent blog, Dennis Nally, Global PwC Chairman said “my experience shows consistently that looking beyond the profit motive and shareholder value as the primary compass for business decisions is the most effective and sustainable way to grow investor returns. To do this, companies need to identify more socially relevant reasons for existing, and then pursue those reasons visibly and consistently.”
In our 17th Annual Global CEO survey, CEOs from around the world agreed:
74% CEOs told us that measuring and reporting their total (non-financial) impact contributes to their long term success.
Public backlashes against businesses' increasing profits are becoming more high profile, as consumers, campaigning groups and governments question whether a business is paying its fair share of tax, driving water scarcity, depleting resources or destroying natural habitats. The impact not only rocks reputations, but can damage revenues, and leave the door open for competitors to step in. A holistic view allows risks to business to be identified and managed.
80% CEOs believe it’s important to measure and try and reduce their environmental footprint.
But it's not always straightforward to understand the implications and potential consequences of proposed activity and strategy. Or to get a balanced view from all stakeholders – some are more vocal and organised than others. And, ultimately, rarely is new strategy or product development a clear cut choice between 'good' and 'bad'.
We believe a total impact approach to making business decisions provides the holistic perspective business needs. By valuing social, environmental, tax and economic impacts, business is now able to compare the total impacts of their strategies and investment choices and manage the trade-offs.
For more thoughts from CEOs on sustainability and total impact, take a look 2013’s pulse poll.