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Business-Ethics.com: Sustainable Companies Significantly Outperform

A new study by researchers at Harvard Business School and London Business School concludes that companies which have voluntarily embraced a sustainable business culture over many years “significantly outperform their counterparts over the long-term, both in terms of stock market and accounting performance.”

The study compares a portfolio of 90 “High Sustainability” organizations that have adopted a substantial number of environmental and social policies since the early to mid-1990s with a similar number of “Low Sustainability” companies that have adopted almost none of those policies.  Financial performance of the two groups is tracked for an 18-year period through the end of 2010.

“We document that sustainable firms are fundamentally different from their traditional counterparts with respect to their governance structure, the extent of stakeholder engagement, the extent of long-term orientation in corporate communications and investor base, and the measurement and disclosure of nonfinancial information and metrics,” the study says. “This is an important finding because it suggests that the adoption of these policies reflects a substantive part of corporate culture rather than purely greenwashing and cheap talk.”

Read the full article here: http://bit.ly/tCCyK0

Biography

Professor Ioannou is a leading expert in sustainability leadership and corporate responsibility whose award-winning academic research provides valuable insights into the challenges and opportunities organizations face when developing sustainable business models. An Associate Professor at London Business School, his work focuses on strategic ESG integration and its implications for businesses and investors. He actively engages with leading companies, boards, and executives as a sought-after speaker, advisor, and author. Deeply involved with practice, he serves on advisory boards including the Sustainability Advisory Panel of Merck KGaA and the ESG Advisory Board of DWS Group. He is also a member of the World Economic Forum's Expert Network. Building on his experience advising organizations, he is interested in contributing further as a Non-Executive Director. His research is published in top journals, he is among the most cited scholars in his field, and he teaches popular courses on sustainability leadership and responsible business.

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