Web ExclusiveSustainability-related inquiries from investors and shareholders are part of the new trends, according to a group of surveyed executives.

Ernst & Young LLP and GreenBiz Group conducted a survey in late 2012 of executives and other sustainability-minded thought leaders, asking the group what growing corporate sustainability trends they are seeing this year. After analyzing 282 responses from representatives of 17 different industry sectors, a list of six top sustainability trends was created.

  1. The “tone from the top” is key to heightened awareness and preparedness for sustainability risks.
  2. Governments and multilateral institutions aren’t playing a key role in corporate sustainability agendas.
  3. Sustainability concerns now include increased risk and proximity of natural resource shortages.
  4. Corporate risk response is not well-paired to the scale of sustainability challenges.
  5. Integrated reporting is slow to take hold.
  6. Inquiries from investors and shareholders are on the rise.

Of these six trends, I’m most intrigued by the fact that investors and shareholders are asking more sustainability-related questions than they have in the past. While top-down goals are a good sign of sustainability-minded leadership, demand from stakeholders can lead businesses to adopt sustainability goals and programs at a more rapid pace.

Proposals that focus on social and environmental issues now make up 40 percent of total shareholder proposals. There isn't just an increase in environmental-focused proposals, there is now more support for them. In 2011, an average of 21 percent of investors voted positively on a social or environmental proposal, up from only 10 percent in 2005. Obviously there is still a lot of room for improvement but now that stakeholders are seeing the business case for sustainability, we are likely to see more environmental-based shareholder-submitted proposals.

More than two-thirds (69 percent) of the shareholder-submitted proposals that executives see are focused on efforts to reduce energy consumption. This is followed by greenhouse gas emissions reductions with 64 percent and publishing a sustainability report with 51 percent.

The fact that more than half of shareholder proposals request a published sustainability report is a bit shocking.In this day and age, consumers are demanding transparency and so it would behoove businesses to prioritize a publicly available sustainability report.

Find out more about shareholder demand and other the other trends by downloading the report: 2013 six growing trends in corporate sustainability(PDF).

Melissa Hincha-Ownby Blog


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