Weekly Business Insights from Top Ten Business Magazines | Week 333
Extractive summaries and key takeaways from the articles curated from TOP TEN BUSINESS MAGAZINES to promote informed business decision-making | Since September 2017 | Week 333 | January 26-Feb 1, 2024
Shaping Section | 4
Seven Sustainability Trends to Watch in 2024
By Andrew Winston | MIT Sloan Management Review | January 23, 2024
Extractive Summary of the Article| Listen
Predicting the future is a fool’s errand, but why let that stop us? Last year was volatile, and so was everything around corporate sustainability. So, what will 2024 look like? With the caveat that we’re in a time of chaos (which makes prediction especially challenging), here’s the author’s take for leaders on what will come from the sustainability landscape this year. Starting with the prediction he is most confident in and ending with the least likely, here are seven big, evolving stories that deserve close attention.
- Climate change will get worse. 2023 has been declared the hottest year on record, and in terms of climate impacts, there’s no going back. As many people have said, the coolest, most climate-stable summer of your life was the last one. Climate chaos will continue to bring us major wildfires, extreme floods and storms, heat waves and droughts, and more. We will also see a degradation of natural systems and declines in biodiversity.
- Elections will dramatically influence the future of sustainability and climate action. Roughly half of humanity will vote in national elections this year. Eyes will be on India, the U.K., Indonesia, Russia, Pakistan, Mexico, and many more. But the U.S. election, of course, will get extra attention. Pundits will fill the airwaves for the next 10 months, but nobody — nobody — has any clue what will happen. But what is certain is that these elections are critical to everyone’s future, and how countries address climate change, inequality, and other societal issues (or don’t) will clearly impact business.
- Sustainability reporting will garner more attention and investment within companies. Last year was a big one for transparency and reporting regulations. The European Union drove the agenda with the Corporate Sustainability Reporting Directive, but California — on its own the fifth-largest economy in the world — also passed two climate-related disclosure bills. Companies and sustainability execs were generally overwhelmed with the new requirements, and the year ahead should bring some increased investment in compliance. A Danish industry association estimated that companies will have to spend as much money on nonfinancial reporting as they currently do on financial reporting.
- Clean tech will continue to expand. The International Energy Agency estimated that in 2023, the world added a stunning 440 gigawatts of renewable capacity — more than all of the electric capacity of Germany and Spain combined. China alone added more solar than the existing solar capacity in the U.S. This rapid expansion is being driven partly by aggressive policy (like the Inflation Reduction Act in the U.S.). But even if political winds shift, the real momentum now is economics: Renewables are cheaper in most places, so the expansion will continue.
- Distractions and strawman arguments will proliferate. Clean tech’s expansion threatens some very rich and powerful vested interests. Today, many anti-climate-action stories have become more subtle, moving from “It’s not happening” to “It’s too expensive” (which is, increasingly, blindingly and obviously untrue) to now declaring that EVs are worse for the planet because they do have a footprint.
- Partnerships to tackle sustainability issues at scale will grow. A few times a year — around Earth Day in April, the week of the United Nations General Assembly meetings in September, and the global COP meeting in December — we always see a flood of commitment statements about climate and many more issues. One area of focus that grew in 2023 was collaborations in the sectors producing the most carbon-intensive materials in the world (cement, steel, aluminum, and so on).
- The threat of the anti-ESG movement will wane. This is at the bottom of the prediction list (ranked by likelihood) because it might be a wishful thinking. The anti-ESG story was the biggest issue in corporate sustainability over the past 12 to 18 months. It deeply affected how companies acted, spawning a new word — “greenhushing” — to describe how companies got much quieter about their sustainability efforts.
2 key takeaways from the article
- Predicting the future is a fool’s errand, but why let that stop us? Last year was volatile, and so was everything around corporate sustainability.
- So, what will 2024 look like? With the caveat that we’re in a time of chaos (which makes prediction especially challenging), here’s the author’seven take for leaders on what will come from the sustainability landscape this year. Climate change will get worse. Elections will dramatically influence the future of sustainability and climate action. Sustainability reporting will garner more attention and investment within companies. Clean tech will continue to expand. Distractions and strawman arguments will proliferate. Partnerships to tackle sustainability issues at scale will grow. The threat of the anti-ESG movement will wane.
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Topics: Sustainability, Climate, Environment