How to Set Sustainability Strategy in 2025

Thriving in an era of impact and pushback

We’re not even through the first quarter of the year and already it’s been a rocky ride for sustainability. The new administration has signaled its desire to roll back many climate policies, revoking clean technology goals and pushing for more oil and gas drilling. Companies have pulled back on diversity, equity and inclusion strategies, and greenhushing has become the modus operandi for many. Meanwhile, a flurry of corporate climate disclosure mandates are evolving from the European Union to China to California, resulting in organizations scrambling to understand what they may (or may not) need to report.

With this backdrop, there’s no better time to unveil a new framework for sustainability strategy. Based on interviews with more than three dozen chief sustainability officers or the equivalent, and several group discussions with sustainability professionals, we have found companies that practice what we call sustainability tension management are able to limit the growing conflicts in corporate sustainability and turn it into a management discipline that strengthens business.

STM is the ability to make strategic choices regarding how to optimize the balance among profit, the planet and people. When practiced successfully, we found companies that follow the STM approach are:

• 83% more likely to achieve great results from sustainable innovation and sustainability products/services development
• 44% more likely to achieve great outcomes related to reduced energy consumption
• 40% more likely to achieve great outcomes from responsible supply change management

5 steps to a successful sustainability strategy

STM starts by identifying and engaging priority stakeholders who are critical to sustainability buy-in. Part of this step involves updating the roles and responsibilities of the CSO and their team to focus on positioning itself as a critical part of business that impacts the bottom line.

From there, sustainability professionals can determine the company’s sustainability archetypes — or assumptions about sustainability held by the C-suite, board, sustainability team and other internal stakeholders that often are unstated and vary widely. Our research found six archetypes — akin to personality profiles — that shape how leaders and employees define the purpose and role of sustainability in their company:

• Box checker: Uses sustainability to meet minimum-to-basic level expectations.
• Brand and reputation driven: Uses sustainability to differentiate the company and its brand with key audiences and stakeholders.
• Immediate return driven: Uses sustainability to improve financial performance and competitive advantage.
• Impact and purpose focused: Uses sustainability to express the company’s purpose and values.
• Innovation driven: Uses sustainability to innovate new business model(s), solutions, and processes to drive returns.
• Risk reduction driven: Uses sustainability to mitigate risks.

Once a company identifies it’s sustainability archetype(s) — many have more than one — Step 3 involves analyzing a core set of questions to better develop a strategy, including:

• How essential is it for the company to be associated as a good sustainability actor with key stakeholders?
• Does the company have an opportunity to profitably meet unmet needs through new or existing sustainable solutions?
• What are the emerging sustainability trends that will put the company at risk?

Next, it’s critical for sustainability leaders to make the case for corporate sustainability as a vital value proposition, based on the sustainability archetype of the company — not just a generic business case.

Finally, it’s time to develop action plans that fail fast, so that organizations can learn, improve and scale up.

To dive into the full report on creating a sustainability strategy for today’s era, download the report here.