The importance of Investor Relations and an integrated sustainability strategy

Sustainability is fundamental not only to your corporate strategy but also to your investment case. This is where the Investor Relations function comes in – supporting and promoting your sustainability culture and weaving it into your company’s equity narrative.

We see a clear distinction between an ESG framework (the “what”) and a sustainability strategy (the “how”). What’s key is that a sustainability strategy involves implementation, the results of which the markets can – and should – understand from a value creation perspective. The slides in our downloadable presentation explore this concept further, looking at a broad overview of the pathway from risk mitigation through opportunities and execution to the enhanced valuation upside from integrated sustainability strategies.

Bridging sustainability strategy execution and equity storytelling

As a company, it is essential to connect your sustainability strategy to your investment narrative using language and concepts that resonate with traditional stakeholders. In our presentation, we illustrate how each step in the execution process can become a recognisable building block in the equity storytelling process.

For example, a company addressing a decarbonisation sustainability goal will need to look not only within its organisation but also holistically at its suppliers, partners and customers. The resulting process would be along the lines of the following:

  • Identify and mobilise the drivers of change, including supply chain management, energy consumption, and product development.
  • Look at the required inputs – these could be a temporary cost increase, process innovation, and communications outlays.
  • Finally, experience the outputs – benefits such as security and safe supply handling, working capital efficiencies, competitive advantages and possibly market share gains.

You will probably notice that the factors at play in each step are generally already on stakeholders’ radars – illustrating how sustainability should, and over time will, naturally intertwine with the other parts of the corporate strategic agenda. Thus, the leaders in this space will be those that are the fastest to recognise that sustainability can no longer be a stand-alone action item.

Showcasing best practice from those that are getting it right

To clearly show the importance and mechanics of meaningful strategic execution, we have selected three case studies demonstrating best practice on this front – the Investor Relations materials from Danone, Heidelberg Materials and Bunzl presentations. In looking at these, we draw parallels to the various components of a successful sustainability strategy and explain how this supports and contributes to a compelling equity story. View our downloadable presentation to learn more.