WBCSD CEO: Business Sustainability is 'Always Changing'

A new report tracking business strategies for net zero goals could show that corporate sustainability approaches are entering a new phase. According to the Business Breakthrough Barometer, companies are shifting from ambition-led sustainability towards strategies that deliver competitive advantage and resilience.

The Business Breakthrough Barometer is now in its third iteration. It is a collaborative effort between the World Business Council for Sustainable Development (WBCSD), the Breakthrough Agenda, the Climate High-Level Champions and Marrakech Partnership for Global Climate Action, with support from Bain & Company.

The report uses interviews, current trends and data to examine how risk perceptions are evolving across sectors. It also explores how corporate strategies and investments are creating conditions needed to grow private-sector investment on a global scale.

Peter Bakker, President and CEO of WBCSD, opens the report by asking whether sustainability is over. The question appears particularly relevant given the report's publication at the start of London Climate Action Week.

Sustainability pays its way

Peter addresses this question by stating the answer is no, but notes that sustainability is always changing. He comments: "The Business Breakthrough Barometer 2026 shows that the era of sustainability driven primarily by ambition is coming to an end. What is emerging is a new, more durable phase, where sustainability is increasingly paying its way as a source of resilience and competitiveness."

According to the report, 508 companies were surveyed. The findings indicate that sustainability is showing resilience in the face of adversity.

Corporate investment was expected to slow as companies transition to more sustainable practices, given years of geopolitical uncertainty. However, companies are actually moving forward with their plans.

The shift could mean that businesses are integrating sustainability into their core operations. Rather than purely environmental goals, companies appear to be integrating sustainability into core business strategy.

Capital allocation shifts priorities

According to the Barometer, capital allocation has shifted to prioritise improved resilience, lower costs and greater supply-chain security. Almost all business leaders (92%) say that in the next five to 10 years, sustainability is expected to become a source of competitive advantage, according to the report.

Solutions being implemented focus on clean energy, electrification, regenerative architecture and circularity. New sources of growth and customer demand are also being seen as the result of solutions such as electric vehicles and green buildings.

According to the report, this is the foundation for long-term value creation. The data could show that companies are moving beyond compliance-based approaches to sustainability.

Business leaders appear to view sustainable practices as a way to unlock new revenue streams. The focus on customer demand suggests companies see commercial opportunities in green products and services.

Policy volatility creates challenges

Businesses are facing increased costs as a result of policy volatility and geopolitical fragmentation, the report details. Investment confidence has taken a hit as a result.

According to the report, 68% of leaders view a disorderly climate transition as more likely than one year ago. A disorderly transition is defined as one that is unplanned or contains poor coordination.

The majority (98%) say a disorderly transition is viewed as a risk to all businesses. Only 15% say they feel fully prepared for such a scenario.

According to the report, 47% of companies surveyed reported higher climate-related costs. Factors include supply chain disruption, rising insurance and damaged infrastructure.

Stronger policy is favoured by 85% of leaders. Peter notes: "...strengthening policy and action now is preferable to delaying the harder choices."

Over half of businesses state that clarity and stability of transition policy and regulation is a key factor for investment decisions. Countries with a set policy retain more of an advantage.

According to the report, 42% say supply chain disruptions are risked by a disorderly transition. A further 38% warn that disruption also risks energy cost volatility.

According to the report, 22% add that there is also a risk posed for inflation and increased consumer prices. The findings could suggest that policy uncertainty creates barriers to business investment in sustainability solutions.