SE Advisory Services & IESE Unpick Top-Down Decarbonisation

Modern businesses have made sustainability a boardroom priority, yet many continue to struggle to convert ambitious climate targets into measurable commercial returns.

According to new research from SE Advisory Services and the IESE Business School, the biggest opportunities increasingly lie in the way companies manage energy, industrial operations and investment decisions.

The organisations' 2026 Executive Report argues that while businesses have access to more sustainability data than ever before, many still fail to turn those insights into financial value.

Instead, meaningful returns come when decarbonisation strategies are embedded across operational, financial and risk management functions, allowing energy performance and sustainability metrics to influence everyday business decisions.

The report also draws on discussions from the CSO Circle, convened by IESE's Institute for Sustainability Leadership, where executives concluded that organisations need to move beyond reporting and use sustainability data to guide investment, improve operational performance and strengthen long-term resilience.

Making energy efficiency a competitive advantage

Improving energy performance across industrial operations represents one of the fastest and most tangible ways businesses can capture value from their sustainability strategies, according to the report.

Rather than viewing efficiency programmes simply as a way to reduce electricity consumption, SE Advisory Services and IESE Business School argue they should be considered a strategic tool for strengthening margins, lowering operating costs and protecting businesses from energy price volatility.

The report highlights significant differences in energy consumption between manufacturing facilities producing identical products, demonstrating the scale of untapped savings still available across industry. It cites examples including a five-fold variation in plastic bag manufacturing and a seven-fold difference in brick production.

Assessing projects through a broader operational lens also improves their financial case. When businesses account for benefits such as lower maintenance costs and reduced downtime alongside direct energy savings, the overall value generated by efficiency investments can increase by between 40% and 250%.

Many targeted industrial energy efficiency initiatives are capable of reducing energy consumption by between 15% and 20%, with typical payback periods of just three to four years.

“One idea from this research stayed with me. Yes, sustainability creates value. But this value capture doesn't happen automatically,” writes Steve Wilhite, Executive Vice President at SE Advisory Services, on LinkedIn.

“A surprising amount of sustainability value never reaches the bottom line.”

The report also points to financing benefits, noting that one integrated decarbonisation roadmap helped unlock approximately €100m (US$113m) in sustainability-linked funding.

Can decarbonising supply chains make them more resilient?

While companies often focus on reducing emissions within their own operations, the report suggests the greatest opportunities — and risks — frequently exist across the wider supply chain.

With Scope 3 emissions accounting for more than 70% of average corporate emissions, improving supply chain visibility has become an increasingly important part of both decarbonisation and business resilience strategies.

The report notes that climate-related disruption is becoming a growing financial concern. The World Economic Forum estimates that climate hazards could reduce annual corporate earnings by as much as 7% by 2035, making adaptation and resilience essential considerations for long-term business performance.

Sustainable procurement initiatives are already helping businesses manage these risks. Around one-third of organisations report that such programmes have prevented supply chain disruptions, according to the research.

SE Advisory Services and IESE Business School also warn that physical climate risks could eventually cost the world's largest companies as much as US$1.2tn each year, even before considering wider impacts on demand, revenues or supply chain disruption.

Despite these growing risks, relatively few organisations have comprehensive adaptation strategies in place. The report finds that only 35% have developed climate adaptation plans tailored to their operations, while just 30% publicly report on those plans.

The research also highlights circular procurement and the greater use of secondary raw materials as practical ways to reduce industrial energy demand, lower production costs and improve resource security.

“Companies with this level of financial discipline report up to 20% lower energy use in the first year and up to 30% less unplanned downtime,” writes Steve on LinkedIn.

“The upside can extend well beyond operational savings.

“In one industrial company's shift to a circular business model, the opportunity was modelled to generate €1bn (US$1.14bn) in incremental revenue.”

The report adds that digital traceability platforms are helping organisations replace estimated supplier information with verified emissions and sustainability data, improving procurement decisions while creating new commercial opportunities and supporting stronger operating margins.

Investing in decarbonisation

Sustainability performance is now playing a much more direct role in corporate finance, with investors and lenders increasingly considering climate performance alongside traditional financial indicators.

According to the report, companies with credible decarbonisation strategies and integrated sustainability programmes are benefiting from stronger investor confidence, improved access to capital and lower financing costs.

Across European capital markets, more than 75% of investors say sustainability performance now influences their investment decisions.

One case study highlighted in the research shows how verified ESG performance enabled a global manufacturer to secure up to €100m (US$113m) in sustainability-linked financing through a comprehensive decarbonisation roadmap.

The report also finds that private equity firms and other investors are increasingly rewarding businesses that have successfully embedded sustainability into their operating models, often through higher valuation multiples.

Ultimately, SE Advisory Services and IESE Business School conclude that treating sustainability as a core business performance metric, rather than simply a reporting obligation, can strengthen earnings resilience while improving access to long-term investment.

Bringing executives together on the future of business

The themes explored in the report will continue at the CXO Summit, which takes place on 7–8 October 2026 at Convene 155 Bishopsgate, London.

The event will bring together more than 500 senior executives for two days of networking, strategic discussion and executive learning across four dedicated content streams for CEOs, CFOs, CHROs and CMOs.

More than 50 speakers and four executive workshops will examine the challenges shaping modern business leadership, with sessions covering AI, finance, workforce transformation and sustainable growth.

Among the programme are The Leadership & Strategy Summit, The Future of AI in Marketing, Financing a Sustainable Future, The CEO Summit, The CFO Summit, The AI-Ready Workforce and The Future of People & Skills, offering practical insight into how organisations can strengthen resilience while navigating the energy transition, technological change and evolving market expectations.

Register your interest here.