Companies ‘all in’ on sustainability 40% more confident about business outlook

Companies that fully integrate sustainability into business strategy enjoy a much more positive outlook than others, according to new research.

EY’s 2025 Long-Term Value and Corporate Governance survey of 200 European businesses shows that 91%  are still feeling pressure from investors to act on sustainability, despite a recent US-driven political backlash.

However, most (54%) still treat sustainability as a silo separate from core business – a mistake according to EY. Just 5% of European companies see no distinction between their business and sustainability strategies, while 22% have them integrated “to a large extent” and 19% “to some extent”.

This is despite the clear benefits in truly embedding sustainability into business practices: among ‘sustainability integrators’, 94% are confident about delivering profitable growth over the next 12 months, compared to 71% for the rest of companies. 

This increased confidence expands to other areas, too: 92% of those integrating sustainability are confident about attracting and retaining talent (compared to 68% for others), 88% believe they will achieve their key sustainability targets (against 69%) and 87% are confident they will further build brand perception, customer retention and engagement over the next 12 months (compared to just 36% for others).

Board vs management divide

Sustainability integrators also appear to be more aligned with their boards than those with separate sustainability and business strategies. 

According to the survey, 82% of boards see sustainability as separate from business, and 81% say that sustainability initiatives are the first to be cut when times are hard – despite the fact that two-thirds of CEOs and C-suite members disagree.

In contrast among sustainability integrators, boards are considered 1.5 times more effective at achieving sustainability objectives. In particular, a very large majority of these firms say their boards consistently approve capital expenditure (94%) and operational expenditure (87%) for sustainability. For those with misaligned business and sustainability objectives, these figures stand at 28%.  

Andrew Hobbs, EY EMEIA Public Policy Leader, said: “Companies must act now to embed sustainability or risk being left behind. Embracing sustainability means understanding its tangible commercial benefits while also putting serious investment plans in place. Those who take the boldest steps will not only boost resilience but also gain the confidence to succeed.”

Reputational benefits of integrating sustainability

Fully embedding sustainability also brings significant brand benefits: more than a third of companies in the survey (39%) say they have suffered backlash in the press or on social media because they’ve not done enough on sustainability standards. 

But for sustainability integrators, this number falls to only 6%.

Julie Linn Teigland, EY EMEIA Area Managing Partner and EY Global Vice Chair – Alliances & Ecosystems, added: “By embedding sustainability at the heart of decision-making and leveraging the latest technologies to drive change, businesses not only bolster resilience but also position themselves for success. The call to action is clear: sustainability must be central to business strategies today and into the future.”

And yet, 39% of companies still believe sustainability has always been, and remains, a lower priority than commercial objectives (2% among most advanced integrators).