We see the importance of sustainable operations reflected in a benchmark recently conducted Schouten Zekerheid on risk management at Dutch companies. Integrating Environmental, Social & Governance (ESG) factors into risk management policy is now fourth on the priority list of management boards. Over 60% of the companies have even set up a (limited) ESG reporting process for this purpose.
Here are the eight economic reasons that explain the growing attention to sustainability.
Responding to changing consumer preferences
More and more consumers prefer sustainable products and services. Companies that fail to meet this demand may lose market share and lose customers.
Meet more stringent legislative and regulatory pressures
Governments around the world are adopting stricter environmental regulations and requirements to reduce greenhouse gas emissions. Companies that fail to comply with these regulations and requirements risk fines and legal problems.
Managing physical and financial and risks
Climate change causes extreme weather events. This brings with it risks, for example damage to assets and rising insurance costs. So more attention needs to be paid to risk management on these issues.
Maintain access to external capital
More and more investors and financial institutions are integrating climate criteria into their decision-making processes. Companies that value sustainability often gain easier access to external capital and can negotiate more favorable financing terms.
Achieve lasting cost savings
Sustainable business practices lead to long-term cost savings. Consider more energy-efficient production, waste reduction and avoidance of carbon emissions charges. Furthermore, investments in green energy facilities often pay for themselves quickly.
Strengthening reputation and brand value
Companies that embrace sustainability thereby improve their reputation and build positive brand values. This can lead to more loyal customers and a competitive advantage.
Ensuring continuity
By embracing sustainable strategies, companies are better prepared for future changes in the business environment. Think stricter regulations and greater climate challenges.
Sustainable innovation strengthens reputation
Innovation in sustainability can open business doors. Companies that actively seek new sustainable solutions can enter new markets and gain competitive advantage.
In short, operating sustainably is a business imperative today. It improves business performance because you save on energy and insurance costs, but also because consumers prefer sustainable products and services. Furthermore, operating sustainably reduces the financial risks of tightening environmental regulations and the physical risks of extreme weather events. Moreover, it offers business opportunities in a world that increasingly values environmental awareness and corporate responsibility. All this contributes to your organization's long-term goals and continuity.
Still participate in the benchmark and download the complete report
Not only in the area of sustainability are new risks and opportunities constantly emerging. All kinds of other developments also influence your risk profile. How can you manage those risks and how do other companies do that? You can find out by taking part in Schouten Zekerheid's benchmark. Immediately after completing the questionnaire, you will receive an overview that clearly shows where you stand compared to other companies. You can also download the complete report with the results of the benchmarkfree of charge here: .
