Companies report more and more about their non-financial impact. Most global companies now publish such a sustainability report. However, only a few companies have convincingly integrated sustainability thinking into their core business.

Why resilience is important

A company needs to be resilient and adaptable so that it can grow. The ability to deal with change is crucial. Companies are increasingly confronted with challenges that are linked to the planetary boundaries the world is currently facing – for example, climate change, biodiversity-loss, land and fresh water use, and pollution. The degradation of ecosystems forces companies to realise that corporate social responsibility (CSR) is no longer only an ethical issue but a necessary strategy for the long-term survival of a company. Companies need to be able to translate the challenges linked to the planetary boundaries into business opportunities. Companies that can will keep ecosystems resilient and their business sustainable.

Impact on Triodos SRI funds and services

Triodos Bank aims to invest in companies that have institutionalized such a resilient strategy. The more resilient companies there are, the greater our investment universe can be. Examples of companies in the Triodos Sustainable Investment Universe that have already adopted a resilient approach include Tesla (electric vehicles), Whole Foods Market (organic and natural food retail), EnerNOC Sims (smart grid solutions) and Interface (sustainable carpets). The Sustainable Investment Universe also includes companies that are starting to turn their product portfolio into innovative business models with a stronger drive for sustainable development. Philips for example, has turned its focus from consumer electronics to energy efficient lighting and health care equipment. The company reported that in 2012, 45% of its turnover came from ‘sustainability advantaged’ products. Another example is semiconductor technology company MEMC, which chose to fully focus on solar power technology and changed its’ name to SunEdison

Call for more

Despite the positive examples, there still is a long way to go to ensure that our society’s crossing of the planetary boundaries does not become a sustainable and irreversible problem. The Triodos investment strategy continues to seek companies that set a good example and outperform others in their sector. It also continues to stimulate improved performance of these companies. It is in that light reassuring that there are changes in legislation, as well as increasing pressure on companies from other investors and stakeholders.

Note: The issues explored in this article are relevant for sustainable investments on the stock market. Triodos Bank believes that our socially responsible investments are a powerful means of promoting our values and working for greater sustainability, while enabling us to offer a complete range of attractive investment options to customers who choose to invest on the stock market.