SE Advisory Services & IESE: Decarbonising The CSO Circle

Modern corporate strategy involves framing sustainability as a driver of long-term enterprise value, according to the 2026 Executive Report by SE Advisory Services and IESE Business School. 

Although most large organisations possess high ambition and vast data, a large portion of potential financial value is left uncaptured due to a gap in organisational capability. 

The joint analysis reveals that finding the precise financial case requires embedding sustainable practices across core business functions like operations, risk and financing. 

Insights drawn from the report highlighted the CSO Circle, convened by IESE's Institute for Sustainability Leadership, emphasising that bridging this execution gap requires linking data directly to decision-grade financial insights.

Manufacturing and energy efficiency

Industrial energy use presents the most immediate financial return when evaluated with a holistic strategic approach, as stated in the report. 

Energy efficiency functions as a direct margin and resilience strategy, protecting operations against volatile input costs. 

Studies cited in the report show extreme variations in energy consumption across manufacturing sites producing identical goods, such as a five-fold gap in plastic bag manufacturing and a seven-fold gap in brick production. 

When companies evaluate efficiency projects, including operational benefits like reduced downtime and lower maintenance alongside raw energy savings, the total value of the initiative increases by 40% to 250%. 

Within industrial energy projects, targeted efficiency optimisation initiatives typically deliver 15% to 20% in energy savings with rapid payback periods of 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.”

In access to capital, a single decarbonisation roadmap unlocked roughly €100m (US$113m) in sustainability-linked financing. 

Supply chains and procurement integration

The largest concentration of both environmental exposure and value-creation potential sits outside a company’s immediate footprint within its supply chain, according to the report.

Scope 3 emissions account for more than 70% of total corporate emissions on average, making supply chain traceability a critical operational focus.

By 2035, the World Economic Forum estimates that up to 7% of annual corporate earnings could be lost to climate hazards, making climate-related asset exposure a core determinant of asset valuation, earnings volatility and long-term enterprise value. 

Sustainable procurement programmes help mitigate these risks, with SE Advisory Services and IESE Business School noting that approximately one-third of companies report such initiatives have successfully prevented supply-chain disruptions. 

The report states that for the world’s largest companies, the projected annual financial impact of climate physical risk could reach up to US$1.2tn in the coming decades, not taking into account second-order impacts on revenue, demand or supply chain disruption. 

Analysis shows that only 35% of companies have context-specific climate adaptation plans in place, with only 30% reporting on them. 

Strategic practices like circular procurement and the reintegration of secondary raw materials significantly reduce energy intensity and input costs while bolstering supply 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.”

In the value chain, one industrial group’s move to circular business models was modelled to add €1bn (US$1.14bn) in incremental revenue.

The report states that deploying digital traceability platforms allows organisations to move from estimated supplier data to verified figures, effectively capturing new commercial opportunities and strengthening margin resilience.

Access to capital and strategic valuation

Sustainability performance has shifted from a reputational signal into a direct input for credit risk assessments and capital allocation, as highlighted by SE Advisory Services and IESE Business School. 

Companies with credible, integrated sustainability strategies benefit from improved risk perceptions, stronger investor confidence and measurably lower borrowing costs, the report highlights. 

Across European capital markets, it is noted that more than 75% of investors report sustainability performance shapes their allocation decisions. 

Integrated decarbonisation roadmaps directly unlock capital, as demonstrated in the report by an SE Advisory Services engagement where verified ESG credentials enabled a global manufacturer to secure up to €100m (US$113m) in sustainability-linked financing. 

The report finds that private markets and equity investors increasingly reward deeply embedded sustainability business models with higher valuation multiples. 

Ultimately, the report concludes that treating sustainability as a measurable performance lever allows companies to protect earnings stability while improving overall access to competitive financing.

The CSO Circle

Capturing the full upside of sustainability relies on what SE Advisory Services and IESE Business School term the Capability Multiplier, where value is realised only when measurement, governance and digital execution align. 

The report highlights insights from the CSO Circle, convened by IESE's Institute for Sustainability Leadership with leaders from AltamarCAM Partners, Barceló Hotel Group, BBVA, CaixaBank, Gestamp, MANGO, Roca Group and Suma Capital, emphasising that organisations must transition from basic reporting to active data-driven management. 

Effective governance requires connecting sustainability metrics directly to capital allocation, board oversight and executive incentives. 

Simultaneously, SE Advisory Services and IESE Business School point to integrated digital capability as the core technological infrastructure, which can reduce the time required to collect and validate ESG data by 25% to 40%. 

Deploying digital monitoring tools alongside strong governance controls could help companies achieve up to 20% lower energy use in their first year and up to 30% less unplanned downtime. 

The CXO Summit

The CXO Summit is taking place on 7–8 October 2026 at Convene 155 Bishopsgate, London, bringing together more than 500 C-suite executives for two days of strategic discussion, networking and executive learning.

Designed as a private forum for senior decision-makers, the event spans four dedicated content zones for CEOs, CFOs, CHROs and CMOs, alongside more than 50 expert speakers and four executive workshops.

The agenda explores leadership, AI, finance, people strategy and business transformation through sessions including: 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 insights into organisational resilience, sustainable growth and cross-functional collaboration.

Register interest here