Ninety-eight percent of CEOs say sustainability is core to their role (UN Global Compact / Accenture, 2023). Over 60% of the companies they lead have sustainability teams of one to five people (Conference Board / Tonello, 2025). That gap between stated ambition and allocated resources defines the operating reality of every sustainability function at a large company today.

The Squeeze

Corporate sustainability teams are caught in a compression that is getting worse, not better. Budgets are frozen or being cut. 57% of companies say sustainability initiatives are the first thing eliminated when cuts are needed (EY, 2025). And the Conference Board found that 45% of executives expect to delay sustainability investments in 2025, primarily due to the political environment and tariff-related cost pressures (Conference Board, 2025).

At the same time, the scope of what sustainability teams are expected to deliver has expanded enormously. Nearly 90% of CSOs report spending more time on regulatory compliance than two years ago, with 60% citing regulation as their biggest challenge (Weinreb Group, 2025). The EU’s CSRD alone requires disclosure of approximately 1,200 data points across 12 standards (McKinsey, 2023). Mandatory reporting frameworks are multiplying across jurisdictions while the teams responsible for responding are staying the same size or shrinking.

The result is a function that has been handed strategic significance without strategic resources. McKinsey found that while two-thirds of organisations reported broad sustainability impact, only 43% captured financial value (McKinsey, 2023). The intention is there. The infrastructure to deliver on it isn’t.

What Separates Survival from Value Creation

The conventional response to resource constraints is to do less. Prioritise. Triage. The sustainability teams that are actually thriving under these conditions have done something more precise: they’ve redefined what their function is for.

McKinsey’s survey of 1,141 participants across 90 countries identified what separated the 43% that captured financial value from the rest (McKinsey, 2023). The difference was structural. Organisations that captured financial value approached sustainability from a growth perspective, empowered a specific C-suite executive to collaborate with the CEO, and established a central team responsible for coordinating sustainability across the business. They treated sustainability as an operating discipline connected to financial outcomes, not as a parallel reporting function.

EY’s 2025 Long-Term Value Survey confirmed this pattern at scale. Companies that embed sustainability into core strategy are 40% more confident in their business outlook than peers that keep it siloed (EY, 2025). Only 27% of companies qualify as what EY calls “Sustainability Integrators.” The rest, 55%, keep sustainability separate from business strategy or have no strategy at all. Among the Integrators, 94% reported their board is effective at approving capital expenditure for sustainability. Among siloed companies, that number drops to 28%.

The data tells a clear story. The constraint isn’t sustainability ambition. The constraint is whether the function has connected itself to the financial architecture of the business. The teams that have done this are getting resources, board support, and strategic authority. The teams that haven’t are getting cut.

The Materiality Filter

The most important decision a resource-constrained sustainability function makes is what to focus on. And most companies get this wrong.

Two-thirds of S&P 500 companies have more than 10 sustainability focus topics. Some have more than 30 (McKinsey, 2021). MIT Sloan and Frankfurt University found that companies designated an average of 11.8 issues as highest priority, far exceeding the recommended maximum of six for effective focus (Jay et al., 2025). When everything is a priority, nothing gets the resources it needs to produce measurable outcomes.

The evidence on what works is unambiguous. Harvard Business School demonstrated that firms with strong performance on material sustainability issues significantly outperformed, while firms with strong performance on immaterial issues did not outperform at all (Khan et al., 2016).

BCG’s analysis of more than 500 sustainability initiatives from companies globally found that only 1 in 5 showed any meaningful connection to drivers of business value (BCG, 2022). Only 1 in 15 was changing the basis of industry competition. The rest were compliance activities dressed in strategic language, consuming resources without producing returns that leadership could measure.

For a team of three to five people, this distinction is existential. You can spread five people across 15 topics and produce reporting that satisfies a checklist. Or you can focus five people on three material factors where performance improvement directly affects cost of capital, revenue growth, or risk reduction. The first approach generates activity. The second generates value that the CFO can see. Knowing which factors those are requires sector-level data on what investors and rating agencies actually reward. Internal stakeholder processes don’t produce that level of precision.

Earning the Seat

Resource-constrained sustainability teams that survive share specific characteristics. They don’t look like traditional sustainability functions.

The first is financial translation. Russell Reynolds found that 54% of successful CSOs identified value creation as their primary sustainability driver, with only 20% emphasising brand management and 8% risk avoidance (Russell Reynolds, 2024). BCG found that sustainability announcements framed with clear business case elements — value creation, funding clarity, tangible goals — outperformed those without by 2.1 percentage points in market reaction (BCG, 2023). The teams that earn resources are the ones that have learned to express their work in the language capital allocation uses.

The second is a distributed operating model. KPMG’s 2024 ESG Governance survey found that sustainability professionals increasingly see their function becoming distributed, with business units absorbing sustainability work and finance taking over sustainability reporting, while the central function shifts toward strategic advisory (KPMG, 2024). The Conference Board found the same pattern: the preferred model is a lean central team responsible for strategy, standards, and governance, paired with departmental liaisons who embed sustainability into daily operations (Conference Board / Tonello, 2025). A small team trying to do everything will fail. A small team that coordinates a network of embedded practitioners across the business can scale well beyond its headcount.

The third is strategic prioritisation that leadership can verify. PwC’s analysis of over 4,000 companies found that 84% are maintaining or accelerating their climate targets, even through political transitions (PwC, 2025). The companies that held course did so because they could demonstrate which specific sustainability factors drove financial performance in their sector, backed by data their boards could verify. Bain found that 50% of B2B buyers now assign more business to sustainable suppliers (Bain, 2025). When the evidence of value creation is concrete, the budget conversation changes fundamentally.

The Uncomfortable Implication

KPMG found that 44% of organisations cite insufficient resources as the top barrier to sustainability integration (KPMG, 2024). That’s real. Budget constraints are real. Political headwinds are real. The majority of sustainability functions are genuinely under-resourced for what they’ve been asked to do.

But the data also shows that 40% of companies that have integrated sustainability into core strategy are more confident in their business outlook (EY, 2025). 91% of strategically integrated organisations expect increased revenue, compared to 74% of their peers (BDO, 2025). Companies using AI for sustainability are 4.5 times more likely to see net benefits equal to at least 7% of annual revenues (BCG & CO2 AI, 2024). AI-powered benchmarking and analysis now allow a three-person team to identify material factors, benchmark against peers, and monitor external perception at a speed and cost that manual approaches can’t match. The value is there for the functions that connect to it.

The uncomfortable implication is that the resource constraint is partly a credibility constraint. Teams that can demonstrate financial value creation get funded. Teams that report on activity metrics get cut. Only 31% of companies have fully implemented sustainability programmes (Conference Board, 2024). Of those that have, the difference in outcomes is stark.

The question for every sustainability leader operating with three people, a frozen budget, and a regulatory mandate that keeps expanding: have you built the case that your function creates measurable financial value? Or are you surviving on the assumption that sustainability matters in the abstract, hoping that organisational goodwill lasts longer than the next budget cycle?

References

• UN Global Compact / Accenture (2023). “12th CEO Study.”
• Conference Board / Tonello (2025). “Best Practices for Corporate Sustainability Teams.”
• EY (2025). “5th Long-Term Value and Corporate Governance Survey.”
• Conference Board (2025). “Sustainability Under Scrutiny.”
• Weinreb Group (2025). “Chief Sustainability Officer Report.”
• McKinsey (2023). “Cloud-Powered Technologies for Sustainability.”
• McKinsey (2023). “ESG Momentum: Seven Reported Traits That Set Organizations Apart.”
• McKinsey (2021). “Organizing for Sustainability Success.”
• Jay, J., Isaacs, J. & Nguyen, T. (2025). “Getting Strategic About Sustainability.” Harvard Business Review.
• Khan, M., Serafeim, G. & Yoon, A. (2016). “Corporate Sustainability: First Evidence on Materiality.” The Accounting Review.
• BCG (2022). “The Strategic Race to Sustainability.”
• Russell Reynolds (2024). “The Voice of the Chief Sustainability Officer.”
• KPMG (2024). “ESG Governance and Organisation Survey.”
• PwC (2025). “State of Decarbonization Report.”
• Bain (2025). “How Sustainability Is Creating B2B Growth.”
• BCG (2023). “Investors Want to Know Your Sustainability Business Case.”
• KPMG (2024). “Sustainability Organisation Survey.”
• BDO (2025). “2025 Sustainability CFO Outlook Survey.”
• BCG & CO2 AI (2024). “Carbon Survey: Climate Leaders Boost Bottom Line from Decarbonization.”
• Conference Board (2024). “Structuring Corporate Sustainability for Business Advantage.”