Corporate Sustainability Strategies Gain Traction as Companies Eye Profitable Climate Resilience

The 2025 ‘Sustainable Signals: Corporates’ report from the Morgan Stanley Institute for Sustainable Investing highlights a strong global trend: 88% of corporations now see sustainability as a value creation opportunity. This marks a three-point increase from 2024, with notable regional gains in North America and Europe. Companies are also showing tangible progress, with 65% reporting they are meeting or exceeding expectations in implementing their sustainability strategies.

While the path to sustainability is promising, challenges persist. Chief among them is the high capital investment required, cited by 24% of respondents. Political, macroeconomic, and regulatory uncertainties closely follow as barriers. Nevertheless, over 80% of companies report being able to quantify return on investment (ROI) for sustainability spending—including capital expenditures, research and development, and operational expenses—on par with traditional investments.

The report also sheds light on the growing business impact of physical climate events. More than half of the companies surveyed reported operational disruptions due to extreme weather in the past year, with 57% affected globally and 73% in the Asia-Pacific region. Still, more than 80% of companies feel at least somewhat prepared to bolster resilience through infrastructure upgrades, supply chain adaptation, and risk management.

Looking ahead, sustainability is increasingly linked with profitability, efficiency, and investor relations. One in four companies cite higher profitability as the top benefit over the next five years. Key enablers for progress include technological innovation, economic conditions, and rising client demand. As regulatory environments mature and sustainability expectations sharpen, insurance professionals must keep pace with evolving risk models and corporate behaviors.