Yet another in a wave of new studies on the ROI of sustainability was published recently by MassMutual and ImpactROI – Project ROI: Determining the Competitive and Financial Advantages of Corporate Responsibility and Sustainability 2025. The report is certainly interesting reading, although in some ways it repackages existing information, frameworks and consultant-speak. For instance, their overall framework for creating value is nothing new – except perhaps the concise titles of each element:
Source: Project ROI: Determining the Competitive and Financial Advantages of Corporate Responsibility and Sustainability 2025.
This isn’t necessarily bad – every organization puts their fingerprint on reports they issue. I do like the ideas on “three high-level value propositions”:
- “VALUE PROPOSITION 1: Offer sustainability/CR as a feature… [that supports] sales and revenue through consumer attraction and retention.
- VALUE PROPOSITION 2: Use sustainability/CR to drive down costs: Sustainability practices often align with efforts to use resources more efficiently, reduce waste, and optimize opex and capex.
- VALUE PROPOSITION 3: Grow through sustainability offerings. Companies can use sustainability/CR to grow sales and market share by offering sustainability as a feature.”
The examples include good financial metrics (revenue growth and operating cost reductions), but also typical non-financial metrics like tonnes of plastic recycled (no direct financial benefit indicated). The conclusion is a little on the aspirational side –
“It is time to put aside the debate of whether sustainability/CR supports business value creation. It is instead time to focus on how to use sustainability/CR to support the business in a way that will enable it to meet expectations and accountabilities to profit, people, and planet at scale.”
Even so, there are good practical business suggestions throughout that should help sustainability professionals more clearly define and defend direct ROI for their companies.
Our members can learn more about the business value of sustainability here.
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