The sustainability narrative has become centered on materiality, effective execution, competitiveness, and commercial integration. This focus underlines the necessity of articulating sustainability matters in financial terms, specifically through quantitative measures, to ensure that business value drivers and their effects on EBITDA and Enterprise Value (EV) are clearly understood within this framework.
WBCSD’s Corporate Performance & Accountability (CP&A) team has collaborated with ERM to help companies with a practical framework and support the integration of sustainability into corporate finance. This included dialogues, events, and a masterclass series on investment cases and financial analyses, navigating associated challenges, and providing step-by-step guidance to integrate sustainability into their own investment decision-making. The sessions fostered cross-sector reflections and deepened the discussion around what’s needed for further integration.
We are launching a thought leadership series drawing on company examples and insights to unpack financial quantification themes raised in recent discussions with corporates.
The series begins with a focus on understanding the broader topic of (inter)dependencies of sustainable investments and the ripple effects of typically intangible benefits on the larger organisation. From there, we home in on how companies are assessing the “greenium” and revenue management, capturing long-term value implications through terminal value assumptions, applying return and cash-flow methods , and using sensitivity analysis to price in externalities. Each piece builds on the last to show how financial integration is not just possible, but essential for making sustainability decisions stick.
We invite you to consider the following questions to assess your organization’s degree of integration of sustainability and financial strategy:
- Which sustainability factors are most critical to your long-term value creation?
- What changes in governance, incentives, or decision-making tools would enable sustainability to be treated as a strategic value driver?
- Is sustainability embedded in your capital strategy? How effectively are ESG risks and opportunities integrated in capital planning processes?
- Are you accounting for indirect impacts — such as brand equity, talent attraction, or supply chain resilience — in your investment decisions?
- Do all key functions, including Strategy, Operations, Finance, and Risk, understand the broader ripple effects of sustainability-related decisions?
Quantifying and integrating financial factors are crucial for effective, profitable sustainability. This series guides readers through the key aspects of making sustainability measurable and impactful.