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It begins with an effort to communicate the business value of sustainability in terms investors already understand: the potential to drive revenue growth from sustainability-advantaged products, improve productivity (and margins) from sustainability initiatives and measurably reduce key sustainability-related risks to revenue and reputation.

Understanding how effectively a business is exploiting the new global force in business in simple terms may be a key indicator that every analyst needs to know.

n 2012, DuPont generated more than $10bn from environmentally advantaged products

t rests on the recognition that attention to corporate social and environmental responsibilities is generally in the long-term economic interests of the firm.

Managers have a responsibility to consider those affected by company actions; equally, however, those stakeholders are often able to exert pressure on a company if it does not—even to the extent of shutting down the business, as Coca-Cola found in Kerala.  This is particularly true for large companies subject to intense media scrutiny.

When companies implement “strategic CSR” they can find there are many benefits, including strengthened corporate and brand reputations and enhanced trust with key stakeholders (customers, employees, regulatory agencies, suppliers, and investors), improved risk management, increased revenues from innovation to identify new business opportunities, and reduced costs from efficiency improvements. 

But the story in a lot of people’s minds is: “I know I’m supporting Monsanto and Raytheon, and I don’t like that, but I don’t know what else to do. The social index fund isn’t a great alternative. I think I’d like to really diversify, like going in on a local business.” When businesses that are values-based offer this kind of investor the chance to invest small amounts – $50?  $500?  $2,000? – plus a basis to believe they’ll get a return – they’ll go for it. I know I would.