Novo Nordisk A/S, a global healthcare company, follows a business philosophy based on balancing financial, social and environmental con- siderations.
How to Become a
Few companies are born with a broad-based commitment
to sustainability. To develop one, companies need leadership
commitment, an ability to engage with multiple stakeholders
along the value chain, widespread employee engagement and
disciplined mechanisms for execution.
BY ROBERT G. ECCLES, KATHLEEN MILLER PERKINS AND GEORGE SERAFEIM
CORPORATE SUSTAINABILITY HAS captured the attention of much of the world over the
last few years. Trends including the growth of nongovernmental organizations and movements such
as Occupy Wall Street suggest that the public is no longer satisfied with corporations that focus solely
on short-term profit maximization. People want corporations to consider broad human needs.
Surveys show that a growing number of companies are taking notice of these shifts and have come
to consider sustainability-related strategies necessary to be competitive. 1 One recent study that compared companies that adopted environmental and social policies with companies that didn’t,
authored by two of the authors of this article and another colleague, provides empirical support for
this view. “High sustainability” companies significantly outperformed their counterparts over an 18-
year period in terms of both stock market and accounting criteria, such as return on assets and return
from traditional ones?
; Sustainable organizations are effective
at engaging with external stakeholders
; They have cultures
based on innovation
; They have a track
record of implementing large-scale
COURTESY OF NOVO NORDISK A/S
SUMMER 2012 MIT SLOAN MANAGEMENT REVIEW 43