Corporate sustainability: from compliance to value creation

A new study sheds light on sustainability trends

Original content provided by BDO Belgium

Transitioning to a sustainable system is becoming an urgent priority due to the growing problems caused by environmental degradation, climate change, loss of biodiversity and social injustice worldwide. As a consequence, sustainability has become a non-negotiable prerequisite of corporate conduct.

To assess the latest trends impacting companies’ transition to sustainability, BDO Belgium and Mercuri Urval conducted a survey among 150 European companies of all sizes ranging from large listed companies to SMEs from different sectors. The findings from this study show that:

75% of participants would describe their ESG (Environmental, Social, Governance) ambitions as being aimed towards value creation, and only 25% describe it as purely geared towards compliance.

ESG integration as a driver for value creation

With growing regulatory and market demands, integrating ESG into corporate strategy and decisions is becoming a must. However, if it is only driven by compliance as the result of new mandatory legislative requirements, this could lead to increased bureaucracy and administrative costs. On the other hand, embedding ESG into every element of the business will drive growth, create new opportunities and make your company future-proof. 

How can sustainability create value for both the company and its stakeholders? Here are four key reasons:

1.    Access to capital: 

Companies with better ESG performances have easier access to finance. Private investors are increasingly looking for sustainable organisations that will perform better over time and have a higher valuation than companies not taking ESG into account. 

In addition, sustainable companies receive better conditions for loans through beneficial interest rates, while banks and investors are becoming more cautious about investing in unsustainable practices. 

Finally, investments can be supported by green/social public funds, both at European and national level (e.g., the Flemish agency VLAIO, which provides financial support for sustainable companies).

2.    Threats & opportunities:

Companies are increasingly recognising sustainability as both a risk and an opportunity. Negative societal or environmental impacts can lead to reputational damage and financial losses, underscoring the importance of responsible practices. On the contrary, sustainable products and services increase the attractiveness of a company’s offerings and can be sold as prime products, leading to higher margins. 

Moreover, as highlighted by the World Economic Forum's Long-Term Risk Outlook, ESG-related risks are becoming more prevalent, needing proactive measures to mitigate future disruptions (e.g., physical risks linked to climate change, like more frequent floods or drought, that can disrupt the supply chain).

3.    Upcoming policies & legislations

The regulatory landscape has undergone significant shifts in recent years, with national and European authorities implementing laws that profoundly impact companies’ sustainability agendas. Notably, in 2020 the European Commission adopted the EU Green Deal, a package of over 150 policy initiatives designed to integrate sustainable practices across various sectors. 

In addition, the EU institutions enhanced transparency by adopting the EU Corporate Sustainability Reporting Directive (CSRD), which creates mandatory ESG reporting requirements for a large number of companies, including large corporations and SMEs.

Additionally, initiatives such as the Sustainable Finance Package, the Fit for 55 and Carbon Border Adjustment Mechanism (CBAM) aim to promote sustainable practices and align industries with carbon reduction goals. All these new initiatives are gradually pushing organisations towards more sustainable practices. 

4.    Pressure from stakeholders (such as clients, governments and employees)

Clients prefer sustainable companies as partners. Recent EU policies like, for instance, the Corporate Sustainability Reporting Directive create a trickle-down effect, forcing organisations to involve their value chain in their sustainability efforts. This means that larger companies will prefer to do business with companies that have a higher degree of ESG maturity. 

In addition, governments are increasingly including sustainability in their selection process for public tenders, making it a crucial factor for organisations dependent on public contracts.

Finally, a lot of companies struggle with the war for talent. Having a sustainable strategy is often a requirement for potential future employees, especially Generation Z, and is proven to result in higher retention and satisfaction rates.

Overall, the survey results suggest that companies are taking a more proactive approach to sustainability, recognising that such efforts can create long-term value for both the company and its stakeholders. Companies are realising the importance of finding the right balance between people, planet and profit, moving from short-term perspectives to long-term objectives. Besides the compliancy risks, the transition to sustainability comes with a lot of business opportunities and can foster economic growth.

“By embracing ESG, companies can position themselves to seize new market opportunities, secure their licence to operate and enhance their reputation. It’s time to move from compliance to value creation by integrating sustainability at the core of business strategies!”

Transparency and accountability to accelerate the transition

The introduction of the Corporate Sustainability Reporting Directive (CSRD) represents a powerful tool in advancing the ESG transition. The new reporting requirements will foster greater engagement with stakeholders, including investors, customers, employees and regulators, leading to a stronger push towards sustainability for all market actors in the EU.

How can you approach this? What should you consider?  

  • Approach the Corporate Sustainability Reporting Directive (CSRD) as a catalyst for internal transformation, and not as a box-ticking exercise. 
  • Companies will need to disclose how they are identifying, quantifying and managing ESG risks. This not only increases transparency, but will also foster a culture of responsibility and accountability within your organisation. 
  • Use the double materiality approach, required by the CSRD, to systematically assess your impacts and prioritise your ESG actions. This exercise will help you to integrate sustainability considerations into your strategic decision-making processes, leading to the implementation of impactful ESG initiatives that promote long-term value creation and resilience.
  • The CSRD was accompanied by the creation of a standardised reporting framework, the European Sustainability Reporting Standards (ESRS). This means that all companies will have to use the same reporting format, facilitating comparability and external scrutiny. This will lead to a competitive pressure that will incentivise you to improve your sustainability performance over time. 

“The Corporate Sustainability Reporting Directive (CSRD) marks a significant milestone in advancing sustainability efforts. By promoting accountability, transparency and comparability, the CSRD is a transformative tool that will drive cultural and behavioural shifts within companies and the market as a whole.”

Future-proof your business today!

A robust and well-defined ESG journey is crucial for any company as it provides the necessary foundations for incorporating ESG practices into its daily decision-making and operations. With this approach, you can mitigate environmental and social risks and also appeal to investors, customers and employees. 

The ESG journey starts from developing internal expertise on ESG topics, and then integrating ESG considerations into your business strategy and implementing ESG action plans. You can then report on your sustainability performance and receive assurance from auditors.


A clear ESG journey helps you to enhance your company’s resilience, reputation and competitiveness, making it more successful in the long run. If you have any questions on how to shape your ESG journey, don’t hesitate to contact our ESG advisors today.


The research was conducted jointly by BDO Belgium and Mercuri Urval in the following countries: Austria, Belgium, Czech Republic, Denmark, Finland, France, Germany, Italy, the Netherlands, Norway, Spain, Sweden and Switzerland. The study involved surveying companies to assess their attitudes towards sustainability, the obstacles they face and their main drivers. The research used a questionnaire methodology, and the online survey conducted in November–December 2023 reached around 150 companies.