Recent research conducted by leading valuation firm Brand Finance, in collaboration with CSRHub and the International Advertising Association (IAA), unveils that major global brands may be losing out on billions of pounds by inadequately communicating their sustainability efforts.

The Sustainability Perceptions Index analysed responses from over 150,000 participants across 40 countries, delving into the role of sustainability in consumer choices, identifying brands perceived as most committed to sustainability, evaluating the financial value linked to a sustainability reputation, and quantifying the potential value at risk or to be gained by addressing the gap between sustainability perceptions and performance.

Top Performers and Missed Opportunities

Apple emerges as the leader with the highest sustainability perceptions value, amounting to USD33.3 billion. Driven by both financial scale and positive consumer perception, Apple exemplifies how strong sustainability perceptions contribute to brand loyalty and premium product pricing.

Microsoft, holding the second-highest total value at USD22.7 billion, possesses the largest ‘gap value’ in the index — USD3.2 billion. Despite robust sustainability commitments, Microsoft’s communication efforts fall short, suggesting that a more concerted approach could add significant shareholder value.

Value Left on the Table

The study identifies a common trend of major brands, including Microsoft, leaving substantial value untapped due to muted communication on sustainability. A total of 85 brands exhibit a positive gap value of over USD100 million, amounting to USD25 billion.

While Tesla enjoys a positive image as an environmental sustainability pioneer, the study highlights a potential risk. Despite being perceived as highly committed to sustainability, Tesla’s actual sustainability performance falls short, posing a USD1.5 billion value at risk.

Brand Finance’s Strategy & Sustainability Director, Robert Haigh, also underscores the challenge for brands to strike a balance in sustainability communication. Haigh warns against “greenhushing,” emphasizing the need to avoid overly cautious or restrictive approaches that may lead to missed financial opportunities.

Bahar Gidwani, Cofounder and CTO of CSRHub, emphasizes the study’s importance for corporate strategists and brand managers. The transparent access to consensus ESG ratings data provided by CSRHub aims to help companies enhance their corporate ESG performance and unlock full value potential.

Dagmara Szulce, Managing Director, IAA Global, sees the study as a powerful tool to incentivize businesses towards sustainable actions aligned with UN SDGs and the broader aims of the UN Global Compact. By highlighting the financial value linked to sustainability perceptions, the study aims to motivate businesses beyond viewing sustainability as a ‘hygiene factor.’

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