Australian businesses link sustainability and profit
More than two-thirds (68%) of Australian business leaders believe there is a moderate to strong relationship between sustainability and their organisation’s competitiveness and profitability, research from SAP indicates.
A survey of 250 Australian business leaders found that 60% expect to demonstrate a positive financial return on their sustainability investments within the next five years. Already, 11% of respondents say sustainability is material to their business results, and a further 36% expect this to be the case within five years.
Nevertheless, 40% of Australian business leaders report facing difficulty proving return on investment of their sustainability initiatives. Other notable issues include lack of funding (33%), lack of an environmental impact strategy (32%) and lack of expertise (32%).
The survey found that only 15% of respondents are completely satisfied with the quality of the sustainability data they gather. Australian businesses also trail the global average when it comes to measuring energy consumption and emissions, resource availability and materials use.
This is an issue because 75% of Australian businesses use sustainability data to inform strategic and operational decision-making to at least a moderate degree, the survey found.
On the plus side, 73% of Australian businesses report moderate or strong tracking of scope 1 emissions. But this falls to 64% for scope 2 emissions and 52% for scope 3 emissions.
“Sustainability can no longer be considered separately to the wider financial performance of the business because it is increasingly clear that more sustainable organisations are more successful organisations,” SAP regional CFO for Asia-Pacific and Japan Gina McNamara said. “If our sustainability data is not complete then the decisions we make to improve the health of our planet and our businesses are cast into doubt. The key is to record and report accurate, granular and auditable sustainability data and integrate it with financial data to make the right business decisions.”
