Nobody’s Really Going Green – Most Companies Just Pay Lip Service

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A new report from Arthur D. Little, Sustainable Performance shatters my perception that companies are whole heartedly going green. An analysis of the report at notes this conclusion.

“Sustainable Performance” from Arthur D. Little argues that regulatory and consumer pressures have not pushed corporations toward sustainability beyond superficial measures.

It’s not surprising that the report concluded that, in general, companies only take steps toward going green when it impacts the bottom line. Driven by shareholder concerns companies frequently implement those green solutions that maximize short terms gain. Forced to “report to stock markets” on a quarterly basis, it can be difficult for companies to proceed with longer term green objectives.

Sustainability – and how we are to achieve it – is one of the most debated topics of the moment. Stakeholders, including customers, want to see companies taking action on environmental issues and, in many countries, legislation now demands that companies publish details of their performance on sustainability as part of CSR reporting requirements. As a result, upbeat stories on environmental achievements are easy to find in any number of glossy, corporate publications. However, a closer look at the reporting of sustainability performance and the corporate strategies supporting it reveals that, in many companies, the response to the challenge of sustainability is only skin-deep.

While many, more progressive companies are making strides where reducing carbon emissions and increasing sustainability improves profits and promotes efficiency, in many cases the opportunity to create a competitive advantage is overlooked.

That may be about to change as investment groups start to target green companies. More and more specialized, as well as established investment groups are seeing the future and asking potential partners about their plans for sustainability.

In fact, between 2005 and 2006, the amount of assets managed by SRI (Socially Responsible Investments) funds domiciled in Europe grew by more than 40%

It’s about time.

Image Credit: noelzialee at Flick’r Under Creative Commons License

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