Why corporate boards are not taking sustainable initiatives

Sustainability has become an increasingly important aspect of business operations. In order to achieve long-term success, companies need to be mindful of their carbon footprint, social and governance practices, as well as economic sustainability.

Sometimes the profit pillar is a strong counterweight to extreme environmental sustainability initiatives, such as moving away from fossil fuels or chemical fertilisers. And this is the dilema many corporate board members face when making tough decisions.

The Leadership in Corporate Sustainability – European Report 2018, developed in association with INSEAD Corporate Governance Centre, found that although board members are increasingly recognising the importance of sustainable business practices, there is a large gap between their aspirations and capacity to deliver.

While three quarters of the 234 business leaders polled believe ignoring sustainability will affect long-term value creation, there is still a wide gap between what they want to do and put into practice.

With environmental issues escalating, we are moving towards a point where market-led actions are no longer enough, making the choice between reaching short-term profit targets and long-term sustainability aspirations a tougher battle. Read more about what company board members can do to bridge their sustainability gap here.