The S-Curve Indicator: Week of February 18, 2013

This week’s indicator is 37 percent, which is the percentage of companies reporting profits from sustainability, according to a study published in the MIT Sloan Management Review. This represents a 23% increase over last year.

The ROI of sustainability initiatives is often challenging to quantify, but the rapid rise in companies reporting that sustainability is adding to the bottom line is encouraging. The case studies highlighted in this article illustrate that the way businesses are thinking about “sustainability” has evolved. In addition to driving out waste, new communication efforts, and increasing stakeholder engagement, companies are using the lens of sustainability to encompass a range of product, service, and value chain innovations. Nestle, for example, turned a manufacturer byproduct – coffee grounds – into a source of energy. Dell worked with its suppliers to create packaging from bamboo, a renewable resource that also created a stronger, more durable product for customers. In our work, we’ve increasingly seen business units, not just sustainability groups, looking to new clean technologies and business models to source innovation and drive top-line growth. The study found companies that changed elements of their business model were much more likely to report that sustainability adds profit – a trend we expect to continue.

This is an entry in our series, The S-Curve Indicator, where we highlight a number that’s impacting the world of sustainability.