Investors Undervaluing Corporate Sustainability Due to Lack of Communication. Although individual consumers find value in the sustainability efforts of companies, the stock market has yet to translate these successes into increased stock prices.
It’s a question for the ages — or, at least, the age of sustainability: If sustainable business practices create profits and shareholder value, why aren’t mainstream investors paying attention?”
McKinsey & Company, an American global management and consulting firm, has discovered a gap in communication between companies and investors. The sustainability initiatives of organizations across the country are continually undervalued, due to a lack of communication. Corporate successes aren’t being translated into data that investors can then interpret into stock prices. These two entities struggle to draw a connection between sustainability initiatives and increased shareholder value but the answer lies on both sides, both companies and investors doing their part to communicate.
What we have here is a multi-trillion-dollar failure to communicate.”
McKinsey is set to release a report entitled “Profits with purpose: How organizing for sustainability can benefit the bottom line,” next week. The report, written by Sheila Bonini and Steven Swarts, will discuss the connection between corporate sustainability and shareholder value, and how to share this information effectively. In hopes of closing the gap between corporate sustainability and shareholder value, the report provides the top tends reasons why companies fail to share the full value of their incentives.
You can read the full article at GreenBiz.com