What sets leading companies apart is not a broader sustainability agenda, but a more strategic one.
The defining question for business today is no longer whether sustainability matters, but whether organisations have the courage to turn it into a driver of value creation and reinvention. For leaders, it is a strategic choice about where to compete, how to differentiate, and what must be redesigned or discontinued to stay relevant.
Courage shows up when sustainability moves from the perimeter into the core of a business, such as portfolio logic, capital allocation, operating model, and the value proposition customers actually buy. From my personal experience with many companies, I know this is often not done decisively and consequently enough.
Capital Markets Demand Sustainable Value
And that’s despite the realisation that capital markets are increasingly pricing this reality. In a long-term review of stock-market performance across listed companies worldwide, the top ESG-rating quintile outperformed the bottom quintile by about 35 – 40 percentage points cumulatively over a ten-year period. This performance gap remains after adjusting for differences in industry, geography, and company size. In parallel, investor expectations have hardened as well. 84% of investors say companies should maintain or increase investment in climate adaptation, and 87% say they would increase their investment in companies that use sustainability data to improve efficiency and performance (PwC, 2025).
These findings make the implication clear, that treating sustainability as a core strategic discipline rather than a parallel workstream, is increasingly a competitive advantage.
A Strategic Shift
What sets leading companies apart is not a broader sustainability agenda, but a more strategic one. Transformation gains momentum when sustainability is linked to customer relevance, operational efficiency, technological opportunity, and long-term value creation rather than confined to reporting, risk mitigation, or reputation alone.
Recent evidence suggests that many companies are already moving in this direction. In a recent global survey of sustainability decision-makers at 300+ companies (public and private, >$100m revenue), 88% described sustainability as primarily or partly a long-term value-creation opportunity, and more than 80% said they can measure ROI for sustainability-related investments (Morgan Stanley Institute for Sustainable Investing, 2025). The same survey also shows why companies are taking this shift seriously, as 57% reported operational impacts from climate-related events in the prior year and 80% said they are prepared to increase resilience measures.
Technology then becomes an accelerator, using data, traceability, and product design to scale credible advantages across markets. The goal is simple and hard at the same time, to move sustainability from “important” to “economically decisive” by tying it to revenue, margins, resilience, and investable growth.
Rewiring the Core Business
The strongest transformations reshape the business at its core by developing more sustainable products and services, building circular value creation, adopting new service and revenue models, and designing supply chains for both resilience and impact. Just as importantly, they do not only build the new, but they are willing to phase out outdated technologies, processes, and assumptions.
This shift is supported by recent market research, which estimates that the green economy could grow by almost 50 percent by 2030, from a high base of already more than 4 trillion Euros globally (World Economic Forum, 2025). That makes rewiring the core business not only a responsibility topic, but also a growth and competitiveness move.
Circularity and Legacy Transition
Circularity is a clear example because it forces redesign across product, operations, and supply chain. Yet execution remains a differentiator. A survey across manufacturing-centric industries found that while 79 percent of executives see circularity creating significant value, only 20 percent say they have built circular supply chains at scale (Bain & Company, 2025). This gap creates an advantage for companies that build the capabilities early and scale them fast.
Research on exnovation (i.e. phasing out of outdated products, processes, and technologies) adds an important point here. Deliberately retiring legacy technologies and routines can free up resources and attention, which supports innovation when companies also update the capabilities needed to operate the new model (Hadi et al., 2026). In practice, this can look like a company redesigning a flagship product to be modular and repairable, building a take-back system with partners, and setting a clear timeline to phase out materials and processes that block circularity while tracking business outcomes such as margin, repeat purchases, and supply risk.
Embedding Change in Leadership and Decisions
For me personally, sustainable transformation only becomes real, when it is embedded in leadership, incentives, culture, and investment logic. The most forward-looking organisations create room for experimentation, collaboration, and employee participation while making sustainability visible and credible in the market.
Even among CEOs who say sustainability is fully embedded, far fewer have it built into CAPEX decisions, 65 percent versus 29 percent (KPMG, 2025). Leaders can fix this by embedding sustainability metrics in investment approvals and incentives. A practical example is a company that updates its investment committee rules so every major CAPEX proposal must show not only financial returns, but also clear sustainability effects and transition risks, using the same scorecard across all business units.
Beyond the One-Off Initiative
Systemic thinking makes clear that transformation is not about one big move, but about a portfolio of reinforcing choices that together redefine value creation, with consistency.
True courage in transformation lies not in adding sustainability to the business, but in allowing sustainability to reshape the business itself.
Research supports this logic. One study finds that transformation success rises from 28 percent to 55 percent when companies combine five or more reinforcing success factors, yet fewer than 20 percent apply more than two (Boston Consulting Group, 2025b). For leaders, this means running transformation like a managed portfolio with clear priorities, ownership, and stop decisions, so resources move to the few bets that truly change the business.
A look forward
Summing up, for leaders, the question is whether sustainability remains a set of commitments around the business or becomes a source of strategic competitive advantage within the business. In times like these, when certainties vanish and unexpected geopolitical, economic, societal and ecologic shifts can change plans overnight, courage, in my opinion, means taking the decisions that make the difference by setting clear priorities, funding the future, and phasing out what no longer fits. The companies that win will be those that move from intention to redesign and from redesign to scale until sustainability is visible in products, investment choices, and financial results.
About Dr. Vladimir Preveden
Dr. Vladimir Preveden is an expert on strategic business transformation and has supported more than 240 companies in the DACH region and in CEE in this role. After 20 years at Roland Berger, most of which were in management roles, he now heads his own company, VP Strategy. He focuses on strategic corporate transformation. Furthermore, he supports the Institute for International Business (Team Nell) and the “Headquarters in Austria”-initiative at the WU (Vienna University of Economics) and Business as Senior Associate (part-time). He also teaches at the WU (Vienna University of Economics and Business) and the WU Executive Academy on the topics of strategic transformation, strategic sustainability management, and strategic resilience. His latest book, “Sustainability as a Strategic Competitive Advantage”, is available from Springer Gabler.
References
MSCI ESG Research (2025). ESG Ratings in Global Equity Markets: A Long-Term Performance Review. In: The Journal of Impact and ESG Investing, Vol. 6, No. 1 (Fall 2025). https://www.msci.com/downloads/web/msci-com/research-and-insights/paper/msci-esg-ratings-in-global-equity-markets-a-long-term-performance-review/MSCI-ESG-Ratings-in-Global-Equity-Markets—A-Long-Term-Performance-Review—FINAL2.pdf.
PwC (2025). PwC’s Global Investor Survey 2025. https://www.pwc.com/gx/en/global-investor-survey/pwc-global-investor-survey-2025.pdf.
Boston Consulting Group (2025a). The Valuation Boost That Comes with Green Growth. https://www.bcg.com/publications/2025/valuation-boost-comes-with-green-growth.
Boston Consulting Group (2025b). Transformation Paradox: How to Grow When Growing Gets Tough (16.04.2025). https://www.bcg.com/publications/2025/transformation-paradox-how-grow-when-growing-gets-tough.
Morgan Stanley Institute for Sustainable Investing (2025). Sustainable Signals: Corporates 2025 / “Companies See Sustainability as a Way to Create Value” (Jun 30, 2025). https://www.morganstanley.com/insights/articles/corporate-sustainability-signals-report-2025.
World Economic Forum (2025). The Multi-Trillion Dollar Growth Opportunity: New Report Shows Green Economy Expected to Surpass $7 Trillion in Annual Value by 2030 (Press release, 02.12.2025). https://www.weforum.org/press/2025/12/the-multi-trillion-dollar-growth-opportunity-new-report-shows-green-economy-expected-to-surpass-7-trillion-in-annual-value-by-2030/.
Hadi, N. U.; Raza, M. A.; Orole, F.; Abdullah, A.; Khan, M. I. (2026). Exnovation as a strategic enabler: Unlocking technological innovation through ambidexterity and capability reconfiguration. International Journal of Innovation Studies. https://doi.org/10.1016/j.ijis.2026.01.001.
KPMG (2025). Global CEO Outlook Survey 2025. https://kpmg.com/xx/en/our-insights/value-creation/global-ceo-outlook-survey.html.
Dr. Vladimir Preveden
Owner
VP Strategy
