Leveraging Sustainability for Competitive Advantage

I recently moderated a discussion with three experts from a range of industries on how businesses can leverage sustainability as a source of competitive advantage. Our participants were: 

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  Tim Faveri, Vice President, Global Sustainability, at Nutrien, one of the top global providers of crop inputs and services 

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  Aysu Katun, Vice President, Sustainability, at Greif, a global industrial packaging manufacturer 

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  Torsten Lichtenau, Global Head of Carbon Transition Practice at Bain & Co., a global management consulting firm. 

They shared their insights – formed through hard-won experience - on how corporate sustainability initiatives can contribute to financial performance, and they offered practical guidance on how to approach these initiatives.  

Check out a podcast based on the discussion: 

One of the keys to advancing sustainability is understanding what it means in a company’s specific context. That could include understanding the incentives that are available, your clients’ expectations, and what regulations are either in place or on the horizon. As Lichtenau explained, those factors can differ depending on the business sector. 

For example, packaging is a sector that has embraced the need for greater sustainability, and consumers have clear preferences on environmentally friendly product packaging.  The message is clear: there are growing revenue opportunities for companies that invest in sustainability. 

Indeed, the latest BMO Climate Institute Business Leaders Survey supports this, finding that customer expectations are increasingly driving companies in North America to address the impacts of climate change. When asked why their companies are taking climate actions, respondents who cited expectations from customers and investors rose to 38% and 25%, respectively, up from 31% and 22% in when last surveyed in 2023.  

For many companies, compliance with various sustainability regulations is a requirement. However, as Katun explained, this does not have to be a burden. On the contrary, in meeting or exceeding regulatory requirements, there can be opportunities to generate value by capturing revenue, strengthening brand recognition or improving operational efficiency.  

This sort of reframing of climate change as an opportunity to improve products and services was the focus of another recent client event with Tom Steyer, Co-Executive Chair of Galvanize Climate Solutions, a climate-focused global investment firm. 

Katun also gave the example of how Greif’s customers in the chemicals industry had been ahead of the curve in integrating sustainability into their operations. Greif recognized an opportunity and ended up collaborating with customers on sustainable and circular packaging solutions, opening another source of revenue growth for the company.   

One of the most straightforward pieces of advice from the panel was to take advantage of sustainability trends where economic momentum is already clear. For example, 90% of the increase in global electricity capacity in 2024 was from renewable energy, according to the International Renewable Energy Agency.  This is due to falling costs, burgeoning supply and growth in demand due to the inherent flexibility, speed of deployment and scalability that renewables provide. 

For many businesses, renewables – coupled with energy storage – are an obvious solution that cut cost and builds energy resiliency, all while significantly reducing greenhouse gas emissions.  

Katun noted that there are many sustainability topics that companies can consider– climate, fair labor practices, biodiversity and waste being obvious examples. That can seem overwhelming. However, a sound sustainability strategy doesn’t need to encompass everything. Many topics won’t be relevant to your operation. Instead, focusing on the top two or three opportunities that can make the most material impact on your business is likely to be the most practical strategy. 

Katun said in the initial stages of Greif’s sustainability program, she only focused on energy consumption in North America. The program grew from there.  

Faveri also added that the key is to stay focused on sustainability goals regardless of how in or out of favor it is at any given moment. Value is typically generated over years, not quarters, and what’s going to serve companies well into the future is taking a long-term view on sustainability.