Lead authors: Lai Ly, Global Head of ESG Research, S&P Global Ratings | Lindsey Hall, Head of ESG Thought Leadership, S&P Global Sustainable1 Co-authors: Bruno Bastit, Terry Ellis, Paul Munday, Bruce Thomson, and Dennis Sugrue, S&P Global Ratings; Esther Whieldon and Jennifer Laidlaw, S&P Global Sustainable1 This report neither addresses views about credit ratings on individual entities nor constitutes a rating action. Collaboration between government, financiers and innovators will be key to scale up these solutions. From 2023 we may see more second-hand, vintage and repurposing brands becoming central to the way we shop. Meanwhile, institutional investors under pressure to deploy capital are turning to still-developing voluntary carbon offset markets to meet climate commitments while continuing to finance assets and companies linked to fossil fuels. Dedicated to the advancement of knowledge on world competitiveness. Proactively using renewable energy, reducing waste and reusing materials will not only help companies to be ahead of legislation, but also demonstrate their interest in being part of the solution. We tend to think about collaboration as an external challenge but the key to success lies in redesigning organizations that can align incentives around impact and mobilize complementary resources to achieve it. From battery-powered cruise ships to aviation biofuel derived from microalgae. Since 2019, the number of people affected by food shortages has more than doubled to 345 million, roughly 4% of the world population, from 135 million, as reported by the World Food Programme. In the short term, businesses of all industries and sizes will look at energy-saving measures to reduce both costs and carbon emissions. Lagging investments in the technologies and interventions needed to support adaptation are widening each year - up to $340 billion per year of adaptation finance is needed by 2030. This is why specific claims such as natural, organic, and vegan enjoyed outstanding momentum during 2021, according to Euromonitors Sustainability Opportunity Tracker. Join Team IMD. There is an urgent need for private capital to enter frontier markets to help solve systemic grand challenges. Euromonitor International has identified five key trends affecting the global sustainability agenda in 2023. While most cases have been against companies and investors for not doing enough on climate issues, we have seen an increase in lawsuits pushing back against ESG-related work or investment policies. Error: Something went wrong, try again in a few minutes. Insights on Sustainability Article Toward a more orderly US energy transition: Six key action areas January 12, 2023 - The US drive to decarbonize is at an inflection point. 2023 CDFI Sustainable Investing Trends. Agribusinesses are particularly sensitive to water scarcity, leading to more expensive irrigation, crop damage and weak harvests, which may raise food security and supply concerns, already exacerbated by the Russia-Ukraine war. These macroeconomic and market conditions could constrain issuer appetite for GSSSB offerings. But while the costs of deploying solar have increased, these should start declining and have been relatively small compared to European natural gas price increases, which have risen nearly eight times higher over the past two years. While this tick-box approach demands an incredible amount of data, it does not provide insight on how to seize the enormous opportunities that the sustainable transformation will open up across all sectors. An infographic based on the latest Climate Watch data highlights that energy usage contributes to 73.2% of global greenhouse gas emissions. In 2023, Environmental Sustainability Will Become A Strategic - Forbes Heres a summary of their investment priorities. Despite goods and services prices increasing globally, consumers sustainability awareness remains strong, with two thirds of global consumers worried about climate change, and also willing to play their part to positively impact the environment. Enabling organizations to meet their learning objectives, in a more impactful, convenient and flexible way. Policy incentives will also continue to emerge to stimulate innovation, help tackle climate change and fund the shift to clean energy. yk Ik, Professor of Digital Strategy and Cybersecurity. And the EU looks to advance its own human rights due diligence directive and regulation restricting goods made with forced labor throughout 2023. Girod, Professor of Strategy and Organizational Innovation. Empowering senior teams to identify opportunities for growth and transformation. Peter Vogel, Professor of Family Business and Entrepreneurship, Ivan Miroshnychenko, Research Fellow and Term Research Professor. This years forecast of sustainability trends looks like the perfect storm (in a good way) of purpose-minded, yet business opportunity-led progress. In fact, 57% of global professionals mentioned their company is planning to develop products with carbon-neutral claims, according to Euromonitors Voice of the Industry: Sustainability Survey 2022, fielded January 2022. Results-based climate finance was presented by the World Bank and others as an effective method to drive financing to projects that could generate such credits. 2023 Restaurant Sustainability Trends - Foodservice, Zero Waste According to the REN21 renewable energy community, we globally invested $366bn in renewables in 2021 alone. These include Scope 3 emissions, those which do not come from their own operations but from their larger value chain. Progressive employment practices implemented in the wake of COVID-19 will be tested by cost-cutting related to economic uncertainty. Private-public alignment is necessary to accelerate the transition towards circular models. The durability of sustainable employment practices, implemented in recent years in response to significant shifts in workforce expectations, will be challenged by recessionary risks in many markets. All Trends Business Sustainability Our hand-picked collection of the top sustainability trends of 2023 & 2022. Harnessing collaboration to enable the circular economy, Successful examples include multi-stakeholder platforms like the. As sustainability has morphed from carbon emissions tracking into company-wide commitments to achieve global imperatives, organizations of all kinds find themselves in the business of creating a healthier world. 4 Sustainable Travel Innovations Shaping the Future of the Tourism In 2023, we think continued geopolitical turmoil, persistent inflation, looming recession and worsening physical impacts of climate change will create new tensions between managing near-term risks and making meaningful progress on longer-term sustainability goals. Considering all these pressures, its all too easy to stumble into the ESG reporting trap. According to Deborah Kaplan, global head of sustainability at SAP Customer Success, corralling and understanding tons of disparate data is the biggest challenge for organizations regardless of where they sit on the sustainability preparedness spectrum. Many restaurants now offer compostable containers and utensils that are much more eco-friendly than traditional plastic or styrofoam. Data in your Equity, Inclusion & Diversity strategy: friend or foe? Company executives and boards of directors have become more attuned to the external reporting aspects of sustainability. 2023 Post-filing season update; Electric vehicle federal tax credit rules tightened as of April 18, 2023; Carlos Cordon, Professor of Strategy and Supply Chain Management. While there is a degree of technical knowledge required, including integrated reporting methodologies and disclosure, there is the risk of a tick-box compliance focus that does not lever a real ESG identity. But that wasnt really the expectation at what was dubbed an implementation COP, where the focus was on how to turn pledges and commitments into real-world actions and solutions. These instruments will have to increasingly address investor questions about the effectiveness of targets and incentives. We are the independent guide to sustainability, helping our audience cut through the noise and supporting them as they achieve sustainability goals and reach outcomes with actual business value. For this to be achieved, companies need to measure direct (scope 1) and indirect (scope 2 and 3) emissions. The social dimension of the challenges of climate change, climate action and sustainability has often been an after-thought, but in 2023 this dimension will rise further up the sustainability agenda. The proposals from the ISSB, EFRAG and SEC all use the TCFD framework as a reference for climate-related issues, but differences remain in their specific requirements and how they treat wider sustainability issues. In addition, products carrying carbon-neutral/reduced carbon claims globally increased by 38% during 2020/2021, according to Euromonitors Sustainability Opportunity Tracker (15 countries in seven industries). One simple exercise can be powerful in creating a more inclusive, productive environment. Some governments have responded with new packages such as the U.S. Inflation Reduction Act and Europes REPower EU to incentivize clean energy adoption and energy efficiency. It will likely grow even more, especially in most of North America, Europe, and in fast-growing countries in the Asia-Pacific region and the Middle East. To save on energy bills, firms will renovate buildings to prevent heating loss and implement digital solutions for temperature controls, shut off lighting and equipment when not in use, and replace less efficient outdated equipment. Yet only 21% believe that their organizations are very ready to address such issues. The market for carbon credits will continue to evolve in 2023. Consequently, many companies introduced new incentive structures, benefits, workplace culture initiatives (flexible work, DEI strategies and efforts to improve work-life balance) and career development opportunities to promote the employee experience and better attract and retain talent. Read more about how we track global trends. Not only are they asking those questions, but they are also planning how to pay back the CO2 debt that the company has created since its creation. Finally, the need to draw down greenhouse gases already in the atmosphere will continue to gain momentum in 2023, with technological carbon-removal solutionsin addition to nature-based onesseeing unprecedented investment following the Biden administrations announcement to invest US$3.5bn in carbon-removal technology. Not only are they asking those questions, but they are also planning how to pay back the CO2 debt that the company has created since its creation. Knut Haanaes, Professor of Strategy and Lundin Chair Professor of Sustainability. Droughts impact major economies, including Europe, the U.S. and China, raising prices and creating potential food shortages that disproportionately impact the worlds most vulnerable communities. Sustainable business is so much more than reporting carbon emissions. Therefore, it is important for companies to align with international standards and get advice from experts, such as the United Nations or the Ellen MacArthur Foundation, to pave the way to efficient and impactful implementation. We forecast that total global bond issuance will increase modestly in 20231 as rate rises subside, but inflation risks remain, and global growth is set to stagnate or even tip into recession in some regions. 19 April 2023 by Natalia Olynec, Julia Binder in Sustainability. The global trend of green buildings continues to rise even today. However, the continued lack of a global climate finance taxonomy remains a challenge to bringing transparency and comparability to the space. Today, we have at least 13,000 large and medium-sized companies in Europe transitioning towards more sustainable operations by disclosing their climate footprint. 6 trends that will shape sustainability in 2023 | News | Eco-Business A New Era for Sustainability Accountability Last year we saw an influx. Log in here to join in the conversation with the I by IMD community. The topics in this report on today's emerging sustainability trends are selected for their high growth across sites including Google, TikTok, Instagram, Reddit, Twitter, YouTube, and Amazon. In this context, practical solutions that can accelerate progress on the SDGs will be urgently needed. Gartner researchers predicted that political bodies worldwide would support nation-state commitments to invest tens of trillions of dollars in climate mitigation from 2025 to 2035. Money matters are also driving sustainable business norms. Global Sustainability Trends for 2023 - According to 42 experts These trends highlight the delicate balancing act we see stakeholders facing and managing, weighing various and sometimes opposing forces. Of particular note was how consumers are approaching healthy living in the Beauty & Personal Care category. In the report that follows, we outline nine trends we see rising in prominence in the sustainability landscape during 2023. Sustainability and ESG in 2023 | Bain & Company Russias invasion of Ukraine disrupted energy supplies across Europe, creating energy insecurity, soaring costs, and a strong incentive for investment in renewable energy sources. 5 Sustainable Finance Trends to Watch in 2023 - LinkedIn Against a backdrop . Economist Impact, through its Back to Blue Initiative, has put a spotlight on the need to tackle chemical pollution. Policy incentives will also continue to emerge to stimulate innovation, help tackle climate change and fund the shift to clean energy. MIT Sustainability Summit. . 5 Sustainability Trends in 2023 and Beyond 07 April 2023Save Article Save Article In recent years, sustainability has become an increasingly important issue for businesses and individuals alike. April 28, 2023 . Economist Impacts Martin Koehring highlights why stronger collaboration will be required to accelerate progress in 2023, Head, World Ocean Initiative & Senior Manager, Sustainability at Economist Impact. The increasing risk of environmental, social and governance (ESG)-related litigation, including over sustainability disclosure, will be another challenge for companies and investors to navigate. In order for companies to return to the environment more than they take from it, circular models are needed, as they provide resilient solutions with a triple impact on businesses, people, and the environment. Best Sustainability Conferences To Attend in 2023. The call at COP27 for multilateral development banks to scale up the use of blended finance to attract more private capital, and the push to boost adaptation finance, will underscore how GSSSBs can contribute to closing the climate finance gap.