London, UK (GLOBE-Net) – A growing number of businesses are identifying business risks and opportunities related to sustainability, concludes a survey of corporate sustainability reporting practices. Companies have shifted from a risk management perspective to an “entrepreneurial approach” when dealing with social and environmental issues.

Tomorrow’s Value is the fourth biannual report from London-based consultancy SustainAbility, developed in partnership with the United Nations Environment Programme (UNEP) and Standard & Poor’s. The report ranks companies according to their governance, strategy, management, and presentation of sustainability issues.

The report authors identify a “growing illumination” among corporate leaders that links sustainability performance and reporting to corporate value. Companies such as BP, General Electric, and Wal-Mart are “helping change the game by beginning to build sustainability factors into their competitive strategy.”

Value creation is surfacing as a major component of ‘sustainability reports’, as corporate responsibility moves beyond philanthropy and public relations and into a profit-enhancing component of the core business strategies of these companies. Progressive firms involved in challenges such as climate change and carbon trading are demonstrating a great deal more integration of these issues with their long term visioning and strategic planning.

A majority of the fifty companies identified in the report still take a conservative, risk-base view of sustainability strategies, but the top 14 are developing and disclosing strategies that aim to exploit market opportunities.

The change has been noticed by some mainstream investors, as financial analysts are considering not just downside risks, but also upside market growth opportunities. Seventy percent of companies reported interaction with investors on sustainability matters.

However, most companies have not been active enough in communicating the value of sustainability performance to the investment community, and lack the hard targets and forward-looking information that analysts will read concludes the report. Nonetheless, ‘green’ companies are now being embraced by venture capitalists and financial institutions alike, signalling growing investor interest in clean technology and companies that place a stronger emphasis on sustainability in their business planning.

Standard and Poor’s noted the importance of non-financial disclosures and added that improved reporting of the links between sustainability and core business strategies will aid both sustainability-focused investors and traditional financial analysts.

Corporate moves like GE’s ‘Ecomagination’ strategy, Wal-Mart’s embrace of sustainable development, and BP’s re-branding as ‘Beyond Petroleum’ are examples of corporate strategies that are focused on value creation. Companies that focus solely on risk minimization and accountability could become laggards in the eyes of analysts who see emerging opportunities in carbon trading and similar markets, the report warns.

Overall, companies are doing a better job at integrating sustainability factors into their core decision-making processes, with 80 percent considering at least one sustainability factor in major decisions.

Public policy initiatives and disclosure remain weak, as only 28 percent disclosed their lobbying activities, though this was a “major advance” over previous years.

There is a growing standardization of reports, with the Global Reporting Initiative (GRI) guidelines emerging as the preferred choice for many firms.

The full report can be read here.