Most companies quantify sustainability ROI – and consider it a value driver

A wide majority of companies say they clearly quantify returns on sustainability investments – and a growing number see sustainability as a value driver.

According to the latest Morgan Stanley Sustainable Signals survey of over 300 private and public companies across North America, Europe and APAC, 83% of businesses quantify sustainability ROI the way they would with other investments, including both new projects and risk reduction activities.

As a result,  a growing number of companies (88%, up 3 points from last year) see sustainability as a value creation opportunity. In contrast, 12% see it primarily through a risk management lens, down from 15% in 2024.

“The data suggest that sustainability remains central to long-term value creation,” said Jessica Alsford, Chief Sustainability Officer and Chair of the Institute for Sustainable Investing at Morgan Stanley. “Companies around the world report an alignment between corporate strategies and sustainability priorities as they seek to build resilient, future-ready businesses.”

Rising climate risk and investment in resilience

The business case for sustainability is perhaps made even clearer by increasing climate risks. Over half of companies surveyed experienced an impact on operations from physical climate-related events in the past year – leading to increased costs for 54% of those affected, worker disruption (40%) and revenue losses (39%).

Companies in the Asia Pacific region were the most affected, with 73% reporting impacts. Globally, extreme heat (55%) and extreme weather or storms (53%) were the most common issues. 

More than two-thirds of respondents expect those climate impacts to increase in the next five years, but 80% say they feel very or somewhat prepared to increase resilience.

Barriers and enablers

Despite identified barriers such as the level of investment required and political and macroeconomic uncertainties, most companies (65%) report making good progress on their sustainability strategy, either meeting or exceeding expectations. This is up 6 percentage points compared to 2024.

Asked what they think will support their sustainability journey, a third of companies globally talk about technological advances as a key enabler, while in North America, a favourable economic and operating environment is seen as the most important factor.