The following post is part of a CSRHub series focusing on 10 trends that are driving corporate transparency and disclosure in the coming year. To follow the discussion of each trend, watch for posts on the CSRHub blog every Wednesday.
By Bahar Gidwani
If you’ve ever watched the tide turn, you know that there is a long period where nothing seems to happen then the water suddenly rushes in. The same thing is happening with sustainability as companies rush to take advantage of a surge of interest from consumers, employees and other stakeholders.
While we founded CSRHub in 2007, one of our founders, Cynthia Figge, has been working as a sustainability advisor since 1996. Back in the 1990s, there were few examples of major companies with sustainability programs. A few pioneers on Wall Street, at firms such as KLD, Calvert, Innovest, EIRIS, Vigeo and IW Financial, were starting to gather data on corporate social performance. But, there were no standards for behavior for reporting it, and companies were reluctant to talk about their “softer side.”
Sixteen years later, sustainability has become a “mega trend.” Eighty-eight percent of Fortune 1,000 CEOs say their company is “going green” (Gibbs & Soell, 2011). Seventy-five percent say they have internal people working on their sustainability projects. Sixty percent of 3,000 business executives say they are increasing investments in sustainability (2010 survey by MIT and BCG). Seventy-seven percent of recent MBA graduates would take a pay cut to work for a firm that has a sustainability strategy (2011 Point-to-Point study).
According to a recent study by Verdantix, spending on sustainability has reached almost $50 billion in just four countries – it is probably already above $100 billion worldwide.
At a growth rate of 19 percent per year, sustainability investment is growing more rapidly than spending on computer hardware, computer software and telecommunications equipment. Major firms such as General Electric, SAP and KPMG have created whole divisions to target this market.
Even powerful King Canute could not stop the tide from turning. What took 20 years to start is likely to continue forward for another 20 years, and to reshape the shoreline of corporate behavior.
Bahar Gidwani is a Co-founder and CEO of CSRHub. Formerly, he was the CEO of New York-based Index Stock Imagery, Inc, from 1991 through its sale in 2006. He has built and run large technology-based businesses and has experience building a multi-million visitor Web site. Bahar holds a CFA, was a partner at Kidder, Peabody & Co., and worked at McKinsey & Co. Bahar has consulted to both large companies such as Citibank, GE, and Acxiom and a number of smaller software and web-based companies. He has an MBA (Baker Scholar) from Harvard Business School and a BS in Astronomy and Physics (magna cum laude) from Amherst College. Bahar races sailboats, plays competitive bridge, and is based in New York City.