Embedding ESG into business strategies
Beyond outlining a sustainability strategy, many companies go further by explaining how integrating environmental, social, and governance (ESG) factors relates to their broader business strategy – 91% clearly describe how ESG considerations influence decision-making and corporate direction. Husqvarna is one of these companies, as they describe sustainability focus areas that integrate into their business strategy.
This alignment is valued by stakeholders, with 85% considering it important to understand how ESG factors shape corporate strategy. Investors, analysts, and other key audiences expect companies to demonstrate that sustainability is embedded in their operations rather than treated as a separate initiative. A clear connection between sustainability and business strategy strengthens credibility and helps companies meet growing expectations for transparency and accountability.
Challenges
Social sustainability communication is often under-prioritised
While companies generally perform well in communicating environmental sustainability, the focus on social sustainability lags significantly. For example, 74% of companies present environmental targets in measurable terms extending to at least 2024, but only 47% do so for social sustainability. This gap suggests that social issues, such as diversity, equity, and inclusion, are receiving less attention by being communicated less effectively.
This disparity is further evident in how the companies report on past target achievements. While 31% of companies report on past environmental targets, only 20% do so for past social targets. These figures indicate a need for companies to prioritise and measure social sustainability initiatives more robustly to keep pace with stakeholder expectations. Interestingly, when asked to rank the importance of sustainability data, stakeholders place a high value on both fields, with 88% prioritising social sustainability data and 86% valuing environmental data. This reinforces the need for companies to balance their focus and reporting efforts across both dimensions.
Assa Abloy is one of the companies that provide website visitors with a comprehensive social sustainability section, including past targets and data.