How does EHS investment drive tangible commercial value?

Authors

  • Monica Merlo

    EY Europe West EHS Leader; EY Global EHS Co-leader; Partner, Climate Change and Sustainability Services, EY S.p.A

  • Jessica Wollmuth

    EY Americas Climate Change and Sustainability Services Deputy Leader

10 minute read 21 Aug 2025
Related topics
Climate change and sustainability services
Assurance
Environment, health and safety

Organizations that strategically invest in environment, health and safety initiatives may have a competitive advantage in a volatile world.

In brief

  • Investment in EHS helps drive organizations’ commercial value by delivering reputational, resilience and efficiency benefits.
  • EHS functions give organizations the confidence to succeed in a turbulent landscape — hence, 78% of respondents expect to increase spending on EHS initiatives. 
  • Digital tools enable EHS functions to create value by enhancing their ability to mitigate risks and improve incident prediction and prevention. 

In a world of constant uncertainty and rapid changes, environment, health and safety (EHS) functions are emerging as powerful drivers of business value. Far from being just a compliance requirement, EHS initiatives play a pivotal role in enhancing stakeholder trust, operational efficiency and organizational resilience — which all help to drive commercial value and give organizations a competitive edge in the marketplace.

The 2025 EY Global EHS Maturity Study (pdf) provides a comprehensive look at how strategic EHS investments can become an enabler for value creation. By capturing insights from both senior EHS practitioners and C-suite leaders from a wide range of industries and regions, the study unearths the demonstrable ways that organizations are reaping the benefits of prioritizing EHS initiatives.

The study identifies a difference between organizations that strategically invest in EHS and those that take a more reactive approach — responding to immediate business needs and operational efficiency requirements. Organizations that have been strategically investing in EHS over time (referred to in the study as “EHS leaders”) demonstrate stronger outcomes than respondents with more reactive approaches.

EHS leaders are more likely to say that investment in EHS initiatives has reduced costs during unexpected disruptions (73% compared with 64% of other respondents). They are also more likely to believe their organization’s EHS approach has resulted in marked improvements in operational efficiency (94% compared with 73% of other respondents). Overall, EHS leaders are significantly more likely to say their organization’s EHS initiatives have contributed to increased commercial value (81% compared with 59% of other respondents).

The study offers a roadmap for organizations looking to integrate EHS into their broader strategies. It also demonstrates how investments in EHS initiatives can unlock new levels of performance and resilience.

of EHS leaders say their EHS initiatives have contributed to increased commercial value.

Professional Heavy Industry Engineer Worker Wearing Safety Uniform and Hard Hat, Using Tablet Computer. Serious Successful Female Industrial Specialist Walking in a Metal Manufacture Warehouse.
1

Part 1

The commercial benefits of investing in EHS

A strong EHS stance enhances organizations’ relationships with stakeholders, improves efficiency and boosts resilience.

How EY can help

An enhanced reputation with stakeholders is one of the greatest benefits of investing in EHS as a key component of business strategy. More than three-quarters (77%) of nongovernment respondents say that investors are more attracted to their organization because of its approach to EHS initiatives. Increased customer loyalty is a further advantage. Over two-thirds (68%) of government and public sector organizations believe their EHS stance enhances their organization’s reputation and trust among citizens and stakeholders.

 

Another important benefit is operational efficiency. Nearly two in five respondents (79%) say their EHS approach has resulted in marked operational efficiency improvements. These include improved productivity, incident reduction and enhanced innovation capacity. Organizations with advanced EHS practices tend to experience fewer accidents, injuries, downtime and damage to equipment.

 

Organizational resilience is also boosted by EHS. During periods of unexpected business disruptions, 52% of organizations that proactively invest in EHS initiatives have noticed either minimal or no impact to operational performance, or even significant improvements to it. Two-thirds (67%) say their approach to EHS initiatives has led to greater agility during uncertain times.

 

Organizations with a strong EHS performance may have an advantage in the marketplace because they are more likely to attract and retain customers, secure capital from investors, operate more efficiently and withstand unexpected disruptions. In turn, this performance could deliver commercial benefits such as increased revenue and cost savings.

 

The fact that organizations see EHS functions as a critical source of value creation is underlined by their willingness to further invest in EHS initiatives. More than three-quarters of respondents (78%) expect EHS expenditure to increase over the next three years. Expenditure is most likely to be focused on the achievement of corporate sustainability goals, promoting employee health and wellbeing, and technological advancements.

of organizations say their EHS approach has resulted in marked operational efficiency improvements.
Oil worker is checking the pump near oil derrick on the sunset background.
2

Part 2

EHS investment priorities

Organizations are investing in strategy, leadership and culture, and governance, but technology needs more focus.

Given its capacity to create value, EHS should be a strategic priority for organizations. Yet only half (50%) prioritize and strategically invest in EHS initiatives as a key component of their business strategy. The remainder invest in EHS in response to immediate business needs (36%) or mandatory compliance requirements (13%), while 1% do not see EHS investment as a priority at all.

Respondents rank EHS strategy as the most important EHS initiative for their organization’s reputational integrity, followed by leadership and culture, then governance. There are good reasons why initiatives of this nature should rank highly. An EHS strategy is essential for clarifying the organization’s top EHS priorities and defining its approach to achieving them. EHS leadership is vital for embedding leading practices in teams, while investment in culture is important for supporting adoption of new processes. EHS governance is vital to drive accountability and provide oversight around the core elements of the EHS program.

Technological tools enable EHS functions to monitor their EHS initiatives, measure the impact of those initiatives, mitigate risks, prevent incidents, identify trends, meet their compliance obligations and improve their overall EHS performance. In doing so, they empower EHS functions to create value for their organizations.

Nearly two-thirds (64%) of organizations are using either a single, unified EHS platform (20%) or multiple EHS platforms (44%) to manage and improve their EHS practices. Of those that are using a platform, 86% state that it has enhanced their ability to mitigate risks and improve incident prediction and prevention. Nearly half (49%) of organizations are using artificial intelligence (AI) tools — which can support effective EHS management by processing large data sets to identify trends and enhance risk mitigation.

Yet despite digital tools being a potential accelerator of EHS performance, organizations are not fully capitalizing on their value-creating capacity. Just 27% say technology ranked among their top three priority areas of focus over the past 12 months — which is why it’s encouraging that organizations plan to increase their investments in EHS technologies in future.

of organizations say that their EHS platform has enhanced their ability to mitigate risks and improve incident prediction and prevention.
A male walking the upstairs inspection visual record storage tank oil stairs on the side shell plate.
3

Part 3

How to maximize value from EHS investments

Embed EHS into strategy, exploit digital tools and build a culture of accountability.

While organizations recognize EHS as an important strategic priority, they face challenges in investing in EHS initiatives that realize reputational improvement, operational efficiency and organizational resilience. A major challenge is building the case for EHS investment, particularly given budget pressures and today’s testing market conditions. It can also be hard for organizations to measure their return on EHS investment since some benefits can be hard to measure — for example, the commercial impact of preventing incidents that haven’t happened.

Other challenges that may be preventing organizations from generating commercial value from their investment in EHS include a shortage of resources, insufficient investment in digital tools, lack of EHS visibility at board or senior-leadership level, and inadequate collaboration between EHS and other teams. In many cases, EHS functions are competing for attention and resources with a host of other departments, including sustainability functions.

In light of these challenges, how can organizations realize even greater commercial value from their investment in EHS? Here are some key recommendations from the study:

  1. Embed EHS into the organization’s value creation story: Align EHS initiatives with the organization’s broader vision and objectives to achieve reputational, operational and resilience benefits, which will drive commercial value. EHS should be treated as integral to long-term business success, not just risk management.

  2. Harness the full potential of digital technologies: To truly enhance EHS performance, invest in technologies that integrate with enterprise risk management systems and make strategic use of data. Scaling investments in digital systems, advanced data analytics and AI can result in real-time, actionable insights that allow organizations to anticipate incidents before they occur.

  3. Build a culture of accountability: Ensure that EHS is everyone’s responsibility by integrating it into job descriptions and governance processes. Prioritize open and transparent two-way communication and share knowledge internally and within industry ecosystems.

  4. Foster collaboration: Promote cross-functional teamwork between EHS, sustainability, HR and risk teams to enhance organizational value. When an EHS culture is deeply embedded within an organization, the central EHS function can operate under less pressure. 

  5. Measure and improve: Clearly articulate the desired outcomes from EHS investment and then determine how those outcomes can and will be measured to track progress and demonstrate ROI. Then use insights from measurement to continuously refine strategies and inform future investment decisions.

Today’s world is highly uncertain — and uncertainty is likely to persist for some time. EHS functions can give their organizations the confidence to succeed in this challenging context. That’s why it’s essential that organizations not only maintain current levels of investment in EHS but also make further strategic investments. Those that allow their investment in EHS to stagnate or decline risk falling behind in performance.

2025 EY Global EHS Maturity Study

Discover how strategic investment in EHS can unlock greater value for your organization.

Download the report

Summary

Proactive EHS investment drives real commercial value because it is the foundation of long-term, sustainable business success. To succeed in the future, organizations should deeply embed EHS into their strategy — with this imperative being stronger than ever in today’s volatile world. EHS is not only a means of managing risk but also an opportunity to create enduring value — for stakeholders, society and the planet.

How EY can help

About this article

Authors

  • Monica Merlo
    EY Europe West EHS Leader; EY Global EHS Co-leader; Partner, Climate Change and Sustainability Services, EY S.p.A
  • Jessica Wollmuth
    EY Americas Climate Change and Sustainability Services Deputy Leader
Related topics
Climate change and sustainability services
Assurance
Environment, health and safety

EY refers to the global organization, and may refer to one or more, of the member firms of Ernst & Young Global Limited, each of which is a separate legal entity. Ernst & Young Global Limited, a UK company limited by guarantee, does not provide services to clients.