Organisations proceed to make progress of their sustainability initiatives, regardless of going through geopolitical challenges. Regulation and expertise are proving to be an important a part of this progress, with two thirds of executives agreeing that their organisation won’t ever be capable of obtain its sustainability targets with out local weather tech. That is based on findings from the Capgemini Analysis Institute, the assume tank related to the French consultancy agency.
The group’s newest report, “A world in balance 2024:Accelerating sustainability amidst geopolitical challenges” tracks developments in organisations’ environmental and social sustainability over the past three years. This newest version reviews on what the authors say are marked enhancements in circularity, sustainable design, measurement, water stewardship, biodiversity, and sustainability skilling, regardless of shortfalls in tackling Scope 3 emissions and client skepticism.
Collectively, organisations are ramping up their efforts to satisfy their sustainability targets, say the authors, and a larger degree of sophistication is clear in the best way sustainable practices are adopted, since 2022. 84% of executives this yr say their organisation is on course to satisfy its carbon emissions targets; lower than a tenth say they’re behind.
The group stated progress is especially seen by way of circularity, sustainable product design, measurement, and water administration. As an illustration, practically three quarters of executives say that recycling merchandise is a core facet of their manufacturing technique, up from 53% in 2022, whereas over two thirds stated they had been redesigning merchandise to take away fossil gas feedstock sources, up from lower than half in 2022. As well as, three-quarters of executives have applied a water-stewardship program, up from 55% in 2022.
In late 2023, executives had been planning to extend investments in sustainability this yr. Nevertheless, firms haven’t adopted by way of: common annual funding in sustainability initiatives and practices now stands at 0.82% of complete income, down from 0.92% in 2023.
“This year’s report shows sustainability projects continuing to build momentum in 2024 despite current headwinds,” stated Cyril Garcia, Capgemini’s Head of International Sustainability Companies and Company Accountability and Group Govt Board Member. “Business leaders have the power and the responsibility to steer us towards a more sustainable economy. Water stewardship, biodiversity preservation, and circular practices are now established as key business imperatives. Executives are being very pragmatic, and CO2 reduction must now be translated into cost savings. We continue to see sustainability efforts bolstered by new climate tech innovations and regulations. The best way to build trust and credibility with consumers is by demonstrating tangible outcomes and planning for a future with sustainability at its heart.”
Customers unconvinced about progress
In response to the reviews’ authors, shoppers wish to see companies going even additional and so they demand transparency. The report seems to seek out three-quarters of shoppers anticipating companies to play a bigger position in lowering GHG emissions in 2024. “Furthermore, even as organisations ramp up sustainability initiatives, consumers are more skeptical than ever about corporate sustainability, as more than half believe that organisations are greenwashing their sustainability initiatives, up from 33% in 2023.”
Geopolitics and rules impacting company sustainability initiatives
Executives pointed to climate-related rules as a key driver of sustainability initiatives. A full three-quarters of executives consider that sustainability regulation is critical to attain world local weather targets, and practically two thirds even agree that with out regulation, their organisation wouldn’t have launched many environmental sustainability initiatives.
Globally, 73% of executives agree that the EU’s Company Sustainability Reporting Directive (CSRD) is honing sustainability measurement and monitoring capabilities. Nevertheless, organisations proceed to fall quick by way of reporting on sustainability initiatives, particularly on Scope 3 emissions. Amongst organisations required to report for CSRD in 2025, simply over a 3rd say that they’re ready to report Scope 3 downstream emissions subsequent yr, whereas 86% are ready for Scope 1.
In the meantime, tensions akin to US-China relations, the wars in Ukraine and the Center East, and the European vitality disaster, are resulting in disruption to produce chains and enterprise operations, and uncertainty round authorities funding. This yr, practically two thirds of executives pointed to geopolitics as an rising consideration in sustainability investments, and 69% are involved in regards to the impression of the unsure US political scene. That is felt throughout international locations, however Swedish executives are most involved (75%), in contrast with 71% of US executives and 59% of executives in India.
To entry the complete report: https://www.capgemini.com/insights/research-library/sustainability-trends-2024
Methodology
The Capgemini Analysis Institute surveyed 2,152 executives employed at 727 organisations, every with greater than $1 billion in annual income, throughout 13 international locations in North America, Europe, and Asia-Pacific and in 12 industries and sectors, in June and July 2024. Executives surveyed had been director degree and above and 50% had been from company features, akin to technique, sustainability, gross sales, and advertising; 50% had been from worth chain features, akin to product design, R&D, procurement, and logistics. The Institute additionally surveyed 6,500 shoppers over the age of 18 throughout the 13 international locations and carried out interviews with 12 senior sustainability executives at main organisations globally.
