Corporate sustainability is often critiqued as shallow marketing motivated by optics rather than an enterprise's sense of responsibility for its environmental impacts. The tangible effects of climate change are being felt today around the globe, but U.S. business leaders admit they don't prioritize the risks associated with extreme weather events and climate action failure, according to new research from South Korea-based conglomerate SK Group.

Of more than 500 executives surveyed, only 10% mentioned climate change and its impacts as a top threat to the success of their organization, "even as recent events have confirmed that a warming planet and extreme weather events are having a direct impact on nearly every economic sector worldwide," an SK spokesperson wrote to in an email to SDxCentral.

Instead, 51% of respondents "cited that the top perceived threat over the next five years was financial or economic stability not climate change or ESG [environmental, social, and governance], even as the climate crisis has introduced a vast range of risks for businesses, from disrupted supply chains to rising insurance costs to labor challenges," they explained.

But 75% of respondents say their organization’s sustainability strategy is critical to overall success, highlighting a disconnect between aspirations and reality.

Climate change largely isn't viewed as a crisis because there's a lack of initiative and progress made on sustainable development from an ESG perspective, and lots of enterprises aren't measuring and analyzing the correlation between climate change, business expansion, and economic growth, according to SK.

"Resistance to change is the most common challenge experienced by organizations looking to implement sustainability initiatives," the spokesperson wrote. SK expects this will change, however, once enterprises recognize how directly their business decisions impact investors and the company's overall growth.

As extreme weather is exacerbated by climate change, however, SK noted "one positive take away was that 84% of respondents agree a crisis has helped rally their people together towards a shared goal." The research also revealed 70% agree a crisis made their organization's strategy implementation abilities stronger, and 61% believe their company is better off than if it hadn't faced that crisis.

To those points, the spokesperson referenced the recent COVID-19 pandemic, "and the same can be said for those combating the climate change crisis."

SK maintains the position that enterprises must embrace climate action in order to survive this global crisis. "The business purpose of an organization can no longer only be to just drive shareholder value. It must also provide products, processes, and solutions that help mitigate the effects of climate change," the spokesperson explained.

To sustain both the bottom line and cultural relevancy, companies should integrate ESG programs into long-term growth strategies because that's what consumers are increasingly expecting, they said. "When it comes to climate change, instead of being problem makers, business organizations should be problem solvers. Those that do not upgrade their operations to be more sustainable will ultimately be left behind."

According to SK, effective corporate ESG strategies share these key components: emphasizing the necessity of ESG, transparency, the right team, and strategic investments.

SK recommends enterprises stress the importance of environmental initiatives by dedicating both capital and human resources to drive ESG engagements along with external reporting on the company's environmental impacts. "ESG considerations should shape any business decisions," the spokesperson noted.

Corporate transparency is a priority for a majority of American consumers, so making environmental commitments and actually following through will build trust with stakeholders. "Showing the progress – no matter how big or small – will also provide the type of transparency consumers expect," they added.

Lucrative ESG programs also involve the right people with representation across a diverse cross section of the organization. SK recommends pitching a big tent that involves C-suite executives and operational employees. "Providing multiple perspectives will facilitate conversations on ESG performance and the implementation of short and long-term objectives," they added.

Looking outside internal operations, long-term ESG strategies need to drive investment and capital allocations toward activities that support the company's broader sustainability goals, and returns will "be better supported in the long run by expenditures that implement more sustainable practices and leave a positive impact on the community," according to the spokesperson.