Eight in 10 UK business leaders committed to sustainability investment

22nd November 2023

Despite rising costs and supply chain issues, eight in 10 UK businesses leaders intend to maintain or increase investment in sustainability action over the next two years.

That is according to software company SAP SE’s annual Sustainability Report, which is based on a global survey of 4,700 business leaders, including over 300 from the UK.

Revenue and profit opportunities are a leading motivator for sustainability investment for 37% of UK businesses, with 31% saying that environmental action is already having a strong impact on financial opportunities.

Indeed, 57% expect to see a positive financial return on their sustainability investments within the next five years.

“The connection between sustainability action and financial performance will play a critical role in shaping environmental progress in the future,” commented Edward Manderson, lecturer in environmental economics at the University of Manchester.

“Over the last few years, academic literature has shown that firms benefit financially from sustainability measures, and SAP’s research demonstrates that this is indeed a reality for businesses who are looking to recover fast from the pandemic environment.”

However, despite the link between environmental action and revenue generation, just 5% of UK businesses have assigned responsibility for the strategic direction on sustainability to their organisation’s chief financial officer.

Instead, this responsibility falls to an array of other leaders, including the board of directors, CEOs, chief sustainability officers and chief operating officers, according to 25%, 21,%, 15% and 10% of respondents, respectively.

The survey also found that 28% have difficulty proving return on investment, making long-term progress harder to sustain.

Furthermore, many have difficulty measuring their impact, with 83% having to rely on “guesswork and estimates” for air pollution, and 78% doing the same for nature loss, 69% for supply chain impact, and 60% for water pollution.

This is leading to 89% reporting difficulty with gathering or analysing data for regulatory compliance, at a time when UK leaders are already having to navigate changing regulations, taxes and levies associated with their carbon footprint.

Stephen Jamieson, global head of circular economy solutions at SAP said: “In a climate where stricter regulations are now requiring businesses to disclose environmental impact, leaders who cannot accurately report this data risk allegations of greenwashing, and fines and reputational damage.

“Focusing on implementing a standardised reporting framework will ensure businesses are substantiating their green credentials, getting measurement right, and setting in motion steps that will directly lead to long-term impact.”

Image credit: Shutterstock


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