Building the Business Case
Climate Action Is Smart Business
We all know that combating climate change is the right thing to do for people and the planet. It turns out it’s also the right thing to do for your business. By integrating climate and sustainability into business strategy, companies can create measurable business value, reduce risk, and position their companies for long-term, profitable growth.
Luckily you don’t need to reinvent the wheel to build sustainability into your business strategy. Other companies have already laid the groundwork.
See how Colgate-Palmolive and Dell Technologies have incorporated sustainability into their business models through our video series, created in partnership with Deloitte. >>>
77% of investors believe that environmentally responsible companies are more likely to succeed financially.1
The Business Benefits of Climate Action
Sustainability practices are often more cost-effective. Improving energy efficiency, optimizing shipping routes, eliminating single-use products, and other initiatives can cut costs while reducing emissions. For example, commercial properties can reduce their energy bill by up to 75% by installing solar.²
Climate change poses significant risks to infrastructure and supply chains. Assessing and managing your climate risk can fortify your business operations and ensure that your company is resilient in the face of climate impacts. In 2024, the U.S. alone experienced 27 separate billion-dollar disasters,³ and failing to tackle climate-related risks in supply chains can cost nearly 3x more than the actions required to mitigate these risks.⁴
Climate action can give your company a leg-up in ever-competitive markets, creating opportunities to differentiate and meet future customer needs. There is growing evidence that companies with strong sustainability practices perform better financially,⁵ and products with sustainability features can see a revenue increase of 6-25%+ over non-sustainability products.⁶
Fulfilled employees work harder and stay in their job for longer, improving your company’s performance and saving money in the absence of frequent turnover. Surveys show nearly 70% of employed adults want their organizations to invest in sustainability initiatives.⁷ This number is even higher in younger professionals – 78% of business students want to work for a company with strong environmental practices.⁸
Investors care about all material risks to a company, including climate. For years investors have been asking publicly traded companies for data on climate-related risk and performance. In 2025, a survey found that 96% of institutional investors agreed that integrated sustainability and financial reporting enables better decision-making and can improve a company's financial performance.⁹ Investors increasingly believe that companies that sufficiently assess and manage climate risk are better positioned for uncertainty, making them better investments in the long-term.
Increasingly more stringent regulations in the EU, US, and globally require more ambitious action and detailed reporting on climate risk and performance. Since 2020, there has been consistent growth in climate regulations in all parts of the world.¹⁰ Global companies will face increasing global compliance requirements, even if some regulations are weakening in certain regions. To do the bare minimum now will mean scrambling to catch up later.
99% of executives say that their supply chains are already impacted by climate change.11
Case Study
McCormick & Company
NYU Stern’s Center for Sustainable Business found that McCormick’s Sustainable Sourcing Program had an estimated $6 million in benefits to the food company with potential to increase by 60-70% in the following 5 years.
Making the Business Case to Internal Teams
Sample messages that resonate
Each business unit has different goals and will face different challenges in embedding sustainability into their work. Here are a few ways to frame your climate strategies to key internal teams that may unlock opportunities to meet shared goals.
Procurement
- Scope 3 emissions management helps procurement identify, prioritize, and support suppliers managing climate risks – such as extreme weather – safeguarding supply continuity and minimizing costly disruptions.
- As regulations increasingly mandate Scope 3 emissions reporting and risk disclosures, supplier engagement is critical to ensure compliance and avoid regulatory and reputational risks.
- A proactive Scope 3 emissions strategy strengthens our competitive advantage and unlocks new revenue opportunities by demonstrating to customers that we can meet – and exceed – their sustainability expectations.
- Engaging suppliers drives improved supplier performance, builds stronger relationships, and positions procurement as a strategic business partner.
Finance
- Climate change presents material financial risks – from physical threats like extreme weather to transition risks like regulation, carbon pricing, and market shifts. Integrating climate into our business strategy helps us anticipate, manage, and reduce these financial exposures.
- Global regulatory frameworks are increasingly raising the bar on transparency and accountability. We must meet evolving disclosure expectations, avoid compliance risks, and protect against potential legal liabilities.
- Investors, lenders, and insurers are integrating climate risk into decision-making. A robust climate strategy strengthens our ESG profile, enhances creditworthiness, and helps secure access to more favorable capital and insurance terms.
Research & Development
- Investing in low-carbon and sustainable product innovation positions us as a market leader, opening opportunities to differentiate from competitors and meet future customer needs.
- Regulatory requirements, customer expectations, and resource constraints are shifting rapidly. Building sustainability into R&D ensures our products remain viable, compliant, and attractive over the long term.
- Sustainable design often leads to products that are lighter, more energy-efficient, longer-lasting, and less resource-intensive — delivering cost savings and performance advantages, not just environmental benefits.
More companies than ever are seeing the business case for climate action. CDP saw a nine-fold increase in companies reporting emissions in 2024 compared to 2019.12
Case Study
REI
NYU Stern’s Center for Sustainable Business found that retention and productivity from REI’s employee sustainability program resulted in a total net benefit of $34 million for the cooperative.
Don’t let your business get left behind in the transition to a net zero economy.
Companies at the forefront of decarbonization, adaptation, and other sustainability initiatives are proving that climate action is smart business. By embedding climate action into business strategy, companies can create measurable business value, a clear competitive advantage, and long-term growth and resilience in the face of uncertainty.
Footnotes
- Maslansky + Partners | Responsible Business: A Framework for Communicating ESG in a Polarized World
- Renewable Energy Magazine | 10 Ways Renewable Energy Can Save Businesses Money
- NOAA | Climate Monitoring
- CDP | Strengthening the Chain
- Innocent Ociti | Sustainability Practices and Financial Performance in Companies Across Various Industries
- PwC |2025 State of Decarbonization Report
- Deloitte | Engaged Employees Are Asking Their Leaders to Take Climate Action
- Yale School of Management | Rising Leaders on Social and Environmental Sustainability
- Workiva | Executive Benchmark on Integrated Reporting 2025
- Oxford | Climate Policy Monitor 2024
- Economist Impact | Climate change’s disruptive impact on global supply chains and the urgent call for resilience
- PwC |2025 State of Decarbonization Report
Start Your Journey to Net Zero: Find a Pathway
How do you get buy-in to set a net zero goal? What happens after you’ve made a climate commitment? How do you start tackling emissions in your operations or supply chain? Follow our pathways to access actionable guidance on accelerating your company’s net zero journey.
