Nearly nine out of ten companies regard sustainability as a value creation opportunity, anticipated to drive benefits such as increased profitability, revenue growth, and improved cost of capital, according to a new survey released by [Morgan Stanley](https://www.morganstanley.com/press-releases/morgan-stanley-sustainable-signals-survey-2025—morgan-stanley). The survey also found that companies are becoming increasingly skilled at quantifying the ROI of sustainability investments, enabling better comparisons to other capital allocation priorities.
For the report, “Sustainable Signals: Corporates 2025,” Morgan Stanley surveyed executives at over 330 companies with revenues exceeding $100 million across North America, Europe, and APAC, representing a broad range of industries.
The survey revealed that companies increasingly view sustainability as an opportunity to create value, with 88% of respondents noting its impact on their long-term strategy, up three percentage points from last year. This includes 53% who see it primarily as value creation and 35% as a mix of value creation and risk management.
Notably, the most significant growth in recognising sustainability’s value creation potential was observed in North America and Europe, increasing by 9 and 10 percentage points to 89% and 94%, respectively, over the previous year’s survey.
Increased profitability topped the list of primary ways sustainability could drive value creation over the next five years, cited by 25% of respondents. This was followed by higher revenue growth at 19%, lower cost of capital, and improved cash flow visibility at 13% each.
Besides anticipating sustainability-related value creation, the survey found that companies are becoming adept at measuring the anticipated returns from their initiatives, with 83% of executives now reporting that they can measure the ROI for their sustainability activities similarly to non-sustainability initiatives. This capability enhances strategic capital allocation when comparing with other priorities.
Additionally, the survey indicated growing confidence in sustainability progress, with 65% of executives describing their companies’ sustainability strategy as meeting or exceeding expectations, up from 59% last year. The increased confidence spanned all regions, with North America reaching 65% from 61% last year, Europe at 69% versus 63%, and APAC at 60% compared with 53%.
The survey also assessed executives’ views on the most significant challenges and potential enablers of their companies’ sustainability strategies. “High level of investment required” once again topped the list of global barriers, cited by 24% of respondents as a top three choice, followed by political volatility or uncertainty at 17%. Notably, North American investors were more likely than their global peers to select “political volatility or uncertainty” as a sustainability barrier.
Regarding enablers, the survey found that technological advancements were most commonly cited as crucial for delivering sustainability strategies, at 33%, followed closely by a favourable economic and operating environment at 32%, and growing customer demand at 28%.
As executives increasingly view sustainability as a value creation opportunity, the survey also found a growing awareness of risk. According to the report, 57% of executives reported that their companies had experienced climate-related events over the past 12 months impacting operations, with APAC respondents the most likely at 73%. The most commonly cited events included extreme heat at 55%, extreme weather or storms at 53%, and wildfires or smoke at 36%.
Specific climate-related business impacts experienced over the past 12 months included increased operational costs at 54%, workforce disruptions at 40%, and revenue loss due to business interruptions or supply chain failures at 39%.
Importantly, 60% anticipate negative impacts from physical climate risks in the next five years, while more than two-thirds also foresee their businesses being affected by climate transition risks.
Despite acknowledging climate-related risks, over 80% of respondents reported feeling that their companies are “very” (34%) or “somewhat” (54%) prepared to enhance resilience against climate-related threats.
Jessica Alsford, Chief Sustainability Officer and Chair of the Institute for Sustainable Investing at Morgan Stanley, stated:
“The data suggest that sustainability remains central to long-term value creation. Companies around the world report an alignment between corporate strategies and sustainability priorities as they seek to build resilient, future-ready businesses.”