Insights from the COP30 IAA-ICC-Brand Finance Panel
The integration between sustainability, reputation and brand value has consolidated itself as one of the central pillars of contemporary corporate competitiveness. In an environment marked by the intensification of the climate crisis, regulatory advances and growing public scrutiny, sustainability ceases to be a merely reputational initiative and begins to operate as a structuring element of differentiation, risk mitigation and economic value creation.
It becomes increasingly evident that sustainability is not only a reputational layer but also a measurable driver of economic competitiveness. As regulatory pressures intensify and stakeholders demand clearer evidence of corporate responsibility, companies are now required to translate environmental and social performance into standardised, auditable and comparable indicators. This shift accelerates the integration of sustainability into brand valuation models, aligning ESG performance with financial outcomes and reinforcing the material link between purpose, transparency and long-term value creation.
The COP30 panel that gives rise to this white paper discussed the relationship between sustainability, brand equity and AI-oriented metrics, bringing together global leaders from companies such as PepsiCo, Schneider Electric and Electrolux, as well as experts in environmental governance, responsible advertising and international regulatory standards. The discussion showed that sustainability, when systematically embedded into corporate strategies, can simultaneously generate reputational gains, increase operational efficiency, attract capital, reduce risks and enhance the economic value of brands.
In this context, the Sustainability Perception Index, developed by Brand Finance in launch partnership with the International Advertising Association (IAA), stands out. The Index quantifies positive and negative economic impacts derived from sustainability perceptions, as well as the gap between perception and actual sustainability performance.
Consequently, metrics such as the Sustainability Perception Index become essential tools for bridging the gap between narrative and verified performance. By quantifying both the reputational uplift generated by credible sustainability actions and the value losses associated with perception gaps or greenwashing risks, such frameworks help organisations prioritise the levers that most effectively build trust and brand strength. As artificial intelligence begins to rely increasingly on structured ESG datasets, companies that adopt standardised, AI-ready sustainability metrics will be better positioned to capture intangible value, enhance decision-making accuracy and strengthen their license to operate in a rapidly evolving socio-environmental landscape.
Its latest results highlight, for example, Microsoft’s estimated USD5.6 billion brand value-add opportunity. Microsoft has a relatively strong sustainability performance; however the brand has been hesitant to communicate about this, an example of what is known as ‘greenhushing’. Conversely, Brand Finance was able to evidence USD7.4 billion in lost brand value attributed to the multi-year deterioration of Tesla’s sustainability perception. By translating a reputational attribute into comparable financial metrics, the Index creates a methodological bridge between marketing, finance and ESG, enabling boards, investors and regulators to incorporate the socio-environmental variable into capital allocation decisions.
This document has four main objectives: to consolidate the panel’s reflections on the relationship between brands, reputation and sustainability; to discuss the role of metrics such as the Sustainability Perception Index in quantifying the reputational value associated with sustainability; to analyse evidence of how leading companies have been incorporating ESG criteria into their business strategies, value chains and communications; and to propose pathways for brand management to adopt sustainability more consistently as a lever for economic value.
From a conceptual standpoint, the discussion highlights that reputation and brand are strategic intangible assets with direct consequences for preference, loyalty, pricing power and crisis resilience. Sustainability perception emerges as a central component in this process, varying according to cultural context: European consumers tend to be more critical, while Latin American audiences appear more trusting, although this confidence is sensitive to cases of greenwashing. Sustainability, in turn, becomes a measurable driver of brand value insofar as it is anchored in consistent metrics, subject to auditability and comparability, as proposed by the Sustainability Perception Index.
The presentation of corporate case studies reinforces this point.
- PepsiCo links its sustainability strategy to regenerative agriculture, reduction of Scope 3 emissions and the concept of a “Positive Value Chain”, connecting complex practices to tangible brand attributes, such as the repositioning of Lay’s with a focus on local origin and ingredient simplicity.
- Schneider Electric exemplifies sustainability as a transversal decision-making criterion, embedded in quarterly indicators that carry the same weight as financial metrics, which has translated into revenue, profit and market value growth by multiples greater than 4, 9 and 12 respectively since the explicit adoption of the ESG agenda.
- Electrolux, in turn, articulates sustainability with durability, repairability and circularity, setting concrete targets for recycled content and emissions reduction, while acknowledging that purchase drivers still privilege price and quality, but that attributes such as longevity and resource efficiency are beginning to gain relevance as commercial arguments.
The institutional dimension of the debate underscores challenges related to governance, standardization and the reliability of metrics. Representatives from the International Chamber of Commerce (ICC) and the World Economic Forum emphasise that current reporting systems are costly, fragmented and insufficiently comparable, which hinders comparison and undermines the use of artificial intelligence in ESG performance analysis. Without robust standardisation, AI tends to produce inconsistent interpretations, reinforcing the need for “AI-ready” indicators: comparable, auditable and structured within common taxonomies. At the same time, it is important to acknowledge that regulators are actively working to move the landscape in this direction, and that third-party frameworks have begun to consolidate in an effort to ease the reporting burden.
The discussion on the role of brands in the media and technology chain adds an additional reputational layer, highlighting the risk that advertising investments may indirectly support climate disinformation or practices that run counter to the ESG agenda, thereby generating incoherence between discourse and practice.
The analysis of the evidence makes it possible to identify five mechanisms through which sustainability creates economic value:
- Reduction of operational costs, as in the cases of Schneider’s energy efficiency and PepsiCo’s adoption of bio-inputs;
- Attraction of capital, reflected in market valuation associated with the integration of ESG criteria into corporate strategy;
- Mitigation of regulatory risk, especially in sectors exposed to rising demands for circularity and decarbonisation;
- Reinforcement of consumer preferences, as attributes such as durability, repairability and origin become factors in purchase decisions;
- Strengthening of the social license to operate, reflected in the trust of investors, civil society and talent.
From this diagnosis, several central recommendations emerge. First, sustainability should be integrated into strategy as a board-level responsibility, with supporting ESG targets linked to variable compensation for executives and managers. Internal teams should pay attention to brand value metrics such as the Sustainability Perception Index to quantify potential reputational returns. Communications teams should focus on developing narratives grounded in auditable data and translated into tangible consumer benefits, and monitoring ESG coherence across media, technology and partner chains. Regarding emerging technology, sustainability practitioners should prepare sustainability databases for use by AI systems in standardised formats. In the wider business landscape, brands should look to strengthen sectoral alliances for mutual gain, such as by helping reduce regulatory asymmetries and combat misleading reputational practices.
In summary, the discussions presented here demonstrate that sustainability is no longer merely rhetoric, but a material component of brand valuation. Companies capable of integrating data, governance, transparency and consistent narrative enjoy measurable competitive advantage.
As international standards consolidate and artificial intelligence begins to operate on comparable socio-environmental metrics, the gap between actual ESG practices and their reputation in the market should narrow, rewarding organisations that fully align purpose, performance and accountability. Brand value, in this context, emerges as the economic synthesis of the environmental, social and governance credibility built by companies - and as a key indicator of corporate prosperity in a sustainability-oriented world.
About the author(s): Eduardo Chaves is Managing Director of Brazil, Brand Finance; Robert Haigh is Strategy & Sustainability Director in the London Office; Fabiana Schaeffer is Vice President Sustainability at International Advertising Association (IAA).
