Chief executives believe that business decision making could be improved by examining the holistic impact their companies have on the economy and environment, rather than relying on financial figures alone, a survey by PwC has found.
Almost 93% of surveyed chief executives agreed that measuring their organisations’ total impact could lead to better business decisions, especially those involving risk.
Chief executives surveyed also answered it would also improve their organisations’ relations with employees, regulators and investors.
Chief executives also hope to replace the "boom and bust" growth cycle with "good growth". Good growth would involve looking beyond "narrow notions of input, output and profit," which would lead to "more inclusive and responsible economic development," according to the survey.
The survey also looked at how companies use both financial and non-financial information in their decision making and reporting practices.
Less than a quarter of organisations surveyed make use of both types of information, while only 15% externally reported that information.
However, 4 out of 5 believed it would be more helpful for decision making than conventional financial reporting and that it would help identify new business opportunities.
The survey also found that 60% of organisations measured environmental impacts while 51% reported their findings externally.
Of the largest companies surveyed, with revenues of more than $10bn, 100% of them said they included environmental impacts in board decisions.
PwC global leader of sustainability Malcolm Preston said: "Businesses need to look beyond financial reporting to their wider outcomes and impacts, to understand their total footprint on society in terms of economic, environmental, tax and social impacts and use what they find to guide their decision making."
PwC surveyed 187 CEOs, from companies with revenues between $100m and more than $10bn.
Article by Sebastian Clark