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IBM: Lack of Data Insights Hinders Sustainability

May 12, 2022

A new IBM Institute for Business Value (IBV) study revealed that sustainability is rising higher on corporate agendas, and CEOs recognize sustainability as a business imperative and growth driver. Yet as CEOs face growing pressures from boards and investors, a lack of reliable data insights is hindering their ability to take action.

IBM’s annual CEO study, Own your impact: Practical pathways to transformational sustainability, which surveyed more than 3,000 CEOs worldwide, found that nearly half of respondents rank sustainability as a top priority for their organizations— an increase of 37% from 2021. However, more than half (51%) also cite sustainability as among their greatest challenges in the next two to three years, with lack of data insights, unclear ROI, and technology barriers, as hurdles. And while 95% of CEOs report being at least in the piloting stage of implementing their sustainability strategy, just under a quarter (23%) say they are implementing their sustainability strategy across their entire organization.

“CEOs are leading during one of the most complex environments ever, including war, inflation, talent shortages, and the COVID-19 pandemic health crisis," said John Granger, Senior Vice President, IBM Consulting. "Despite these challenges, they aren’t taking their foot off the gas when it comes to sustainability, and more now rank it among their top priorities. Yet, many don’t fully appreciate the extent to which data and technology can bridge the gap from strategy to impact."

Key study findings include:

CEOs say sustainability is climbing higher on their agendas and believe it can help drive business performance

  • Almost half (48%) of CEOs say increasing sustainability is one of their highest priorities for their organization in the next two to three years – up from roughly a third in 2021.
  • Nearly 70% of surveyed CEOs say they are directly involved in defining their organization’s sustainability strategy.
  • Over 80% of CEOs believe that their company’s sustainability investments will produce improved business results in the next five years and nearly half of CEOs (45%) think that sustainability will accelerate business growth.

Pressure is mounting from stakeholders, but lack of data insights and technological barriers stand in the way

  • More than half (51%) of surveyed CEOs cite sustainability as among their greatest challenges in the next two to three years, up from 32% in 2021, ahead of regulation (50%), cyber risk (45%), technology infrastructure (41%) and supply chain disruption (38%).
  • CEOs reported receiving the greatest pressure from board members (72%), followed by investors (57%), ecosystem partners (49%), regulators (49%) and government (46%).
  • Nearly 60% of respondents list unclear ROI and economic benefits as a leading challenge to achieving sustainability objectives, followed by a lack of insights from data (44%), and regulatory barriers (43%).
  • 35% of respondents also identify technological barriers to implementing sustainability in their organization.

CEOs are putting words into action, yet aren't embedding sustainability strategies across their organization

  • Respondents indicate that CEO investment in sustainability has more than doubled as a percentage of revenue over the last five years.
  • Nearly two-thirds (64%) are confident they’ll achieve their sustainability goals and only 20% of CEOs surveyed believe sustainability targets announced by government for their industry were not achievable.
  • While 95% of CEOs report being at least in the piloting stage of implementing their sustainability strategy, only a quarter (23%) say they are implementing their sustainability strategies across their entire organization.

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