69% of CFOs anticipate higher returns from sustainability initiatives over traditional investments, underscoring a strategic shift towards green finance, according to a report.
Despite geopolitical uncertainties and financial challenges, the report by global consultancy Kearney and media broadcaster We Don’t Have Time have indicated that 92% of CFOs plan to boost net investments in sustainability this year.
The report surveyed 500 CFOs across the UK, US, UAE, and India to assess how financial leaders are integrating sustainability into their core strategies.
93% of CFOs acknowledge the business case for sustainable investments, according to the findings. However, 61% still approach these investments with a cost-focused perspective, suggesting a need for a broader understanding of long-term value creation.
65% of CFOs are now evaluating the costs of inaction, reflecting growing awareness of climate change risks and potential regulatory penalties. According to the researchers, this shift highlights the importance of proactive engagement in the green transition.
Immediate actions prioritised by CFOs include increasing the use of sustainable materials, fostering innovation through green partnerships, and enhancing energy management alongside waste reduction efforts.
Employee influence is also notable, with over 71% of CFOs considering sustainability factors when selecting retirement funds, and aligning financial strategies with workforce values.
Beth Bovis, partner at Kearney and global sustainability lead, said: “The perspective of CFOs is often overlooked in the corporate sustainability debate, yet their role is crucial. As those in control of financial levers, CFOs are uniquely positioned to have a long-term impact on business strategy. And our study highlights that they’re already taking steps in this direction.
ESG reporting is increasingly falling under the CFO’s responsibilities. But beyond simply ensuring regulatory compliance, CFOs can lead the charge in driving investments that not only reduce emissions but also deliver tangible commercial value for the business.”
Ingmar Rentzhog, founder & CEO at We Don’t Have Time, added: “Finance chiefs are increasingly absorbing more of their organisation’s sustainability efforts, and our research shows that they are more than prepared for this responsibility.
Looking ahead, with the UK government set to release its Sustainability Disclosure Standards this year, organisations will be forced to rethink how they measure and communicate their climate initiatives. CFOs will be crucial in navigating these changes, as they must assess and disclose their environmental impact, adding a new layer to financial reporting.”
