Companies
committed to sustainability outperformed their peers last year through the difficult economic period between May and November, according to a new report.
In 16 out of 18 industries companies with a commitment to
sustainability were the clear leaders in the financial markets,
analysts at A.T. Kearney, Inc. reported. These companies outperformed industry averages by 15%, representing $650 million in protected market capitalization per company.
The study, titled "Green Winners: The Performance of Sustainability-focused Companies in the Financial Crisis," looked at 99 companies identified as having a strong commitment to sustainability by the Sustainability Index and the Goldman Sachs Sustain Focus List.
“Our study indicates that the market rewards specific companies,” said Dr. Daniel Mahler, author of the study. “We find common characteristics among the leading companies that show that sustainability goes far beyond the narrow definition of being environmentally friendly.”
These characteristics include:
- A focus on long-term strategy, not just short-term gains
- Strong corporate governance
- Sound risk-management practices
- A history of investment in green innovations
While green measures that produce immediate cost-savings such as reducing packaging material and decreasing fuel use will become increasingly common in a cash-strapped economy, Sustainability and the Financial Crisis suggests that investing in sustainability for the long term may be the best way to protect a company’s value through the months and years ahead.
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