May 7, 2023
Bain & Company and EcoVadis Research Reveals Positive Correlation between Sustainability and Business Results
Bain & Company and EcoVadis conducted research to understand the relationship between ESG (environmental, social, and governance) activities and financial performance of companies. They found that ESG activities have a positive impact on both ESG outcomes and financial performance, making them a trait of successful companies. The study showed that companies with strong ESG activities produce strong ESG outcomes, which correlate with improvement in financial and operational results, including higher profitability and revenue growth, customer satisfaction, and employee satisfaction.
The research also revealed connections between sustainability and business results in the areas of sustainable supply chain, renewable energy, employee satisfaction, and DEI (Diversity, Equity, and Inclusion). For example, companies with high ESG ratings have better female executive team representation, higher employee satisfaction, and greater renewable energy usage. Companies that rank in the top 25% of their industry for executive team gender diversity have annual revenue growth approximately 2 percentage points above that of companies in the bottom quartile.
Bain & Company is a management consulting firm that specializes in advising clients on issues such as strategy, operations, technology, organization, and mergers and acquisitions. The firm was founded in 1973 and has grown to become one of the largest and most respected consulting firms in the world. Bain has worked with clients in a wide range of industries, including healthcare, financial services, consumer products, technology, and private equity.
Ecovadis is a sustainability ratings platform that provides companies with a scorecard to assess their environmental, social, and ethical performance. The company was founded in 2007 and has become a leading provider of sustainability ratings for global supply chains. Ecovadis works with more than 75,000 companies in 160 countries to help them improve their sustainability practices and reduce their environmental impact. The company's rating system is based on international sustainability standards and covers a wide range of criteria, including labor and human rights, ethics and corruption, and environmental impact.