Sustainability + Profit. The missed opportunity

In an era of political, economic and market uncertainty, you’d think that sustainability would be at the forefront of investors’ minds, right? Especially when you consider that the investment market is founded on uncertainty.

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For equity investors looking to make a return over the medium to long-term, my opinion is that a company able to clearly articulate its long-term, economic sustainability is a more attractive proposition than one that can’t.

As is so often the case with companies, they take two key attributes like profit and sustainability, and through their communications discuss them as two mutually exclusive elements.

I recently attended a number of investor days with some disruptive small caps looking to revolutionise the way we live. These are fascinating businesses, looking to both help with and profit from some of the serious issues society is facing.

So I went in thinking that these could be the companies that take some of the many issues (such as energy, water consumption, and poverty) outlined by the SDGs (Sustainable Development Goals) and GRI (Global Reporting Initiative), and use these issues to frame a significant, market and economic opportunity for the organisation’s offering. I expected them to outline the significant benefits their businesses afford society, and in the process, generate profit. True synergy.

Reading between the lines, that is exactly what these businesses do, but like many companies today, the commercial application and the positive implications on society were often discussed as two separate points.

In the same ethos as integrated reporting, how does contributing to the resolution of global issues benefit the company commercially?

Having spoken to a few institutional and private investors, the feedback was much along the lines of: ‘focus on the commercial opportunities that resolving these global issues present the company.’

Sometimes, separating key themes such as profit generation and sustainability within any of your investor communications can render your investment case less powerful. At Jones and Palmer, we are passionate about helping our clients articulate the link between sustainability and commercial opportunity, empowering your investment case.

Our job is to unlock the power of your message, so if like me, you believe in the successful articulation of sustainable, economic growth, let’s talk.

 

Nick Christopher, Client Relationship Director - hello@jonesandpalmer.co.uk