How can investors balance short-term demands with long-term value?

Institutional investor survey

There is a pronounced gap between what investors say and what they do on sustainability.

About the research

We surveyed senior decision makers at institutional investors around the world.

The investor's dilemma

Investors face pressure for short-term returns while recognizing long-term sustainability risks.

Greenwashing concerns

Investors worry that some company claims are not supported by evidence.

Voting for change

Some investors use voting rights to push companies toward better disclosure.

Assessing the impact of climate change

Few investors closely monitor changes in company climate policies

Current reporting may not give investors the insight they need.

Climate litigation

Legal action over climate claims is a growing risk for companies and investors.

Sustainability reporting

Assessing nonfinancial performance

Investors want more structured, comparable information.

Short-term impacts are easier to assess than long-term ones

Investors feel more confident evaluating near-term effects.

Future outlook

Climate risk is likely to be one of the biggest disruptions for decades

Long-term thinking will be essential.

Call to action

Investors should:

1. Balance performance and risk

Weigh long-term risks alongside short-term returns.

2. Monitor policy developments

Track plans of governments, central banks and financial institutions.

3. Analyze transition pathways

Assess sector and company transition plans.

4. Engage with clients on long-term value

Understand beneficiaries' expectations.

5. Invest in sustainability data and technology

Build the tools to analyze sustainability information.

6. Build capability to use new disclosures

Prepare to analyze information under new reporting standards.

Companies should:

1. Engage with investors on sustainability reporting

Understand what investors need.

2. Prevent greenwashing

Make sure claims are evidenced.

3. Publish a detailed transition plan

Show how targets will be met.

4. Understand investor and rating frameworks

Know how you are assessed.

5. Be transparent in disclosures

Report setbacks as well as progress.

6. Communicate your long-term value strategy

Explain how sustainability supports value creation.

Summary

Closing the say-do gap will require effort from both investors and companies.