The vast majority of large companies across the world have been increasing sustainability-related investments over the past year, as C-suite executives have become more concerned about the impact of climate change on their companies, while simultaneously also become more focused on the direct business benefits and opportunities presented by their climate and sustainability initiatives, according to a new survey released by global professional services firm Deloitte, ESG Today reported.
For the study, Deloitte’s 2024 CxO Sustainability Report, Deloitte and market research firm KS&R surveyed more than 2,100 C-level executives in 27 countries, across a broad range of industries and enterprise sizes, ranging from $500 million in revenues to over $10 billion.
The report found that climate change remains one of the top priorities for executives, ranking third in order of importance in the survey’s list of most pressing issued to focus on over the next year, cited by 37% of respondents, closely behind innovation (including artificial intelligence and digital) and economic outlook at 38% each.
The high ranking of climate change as a priority comes as executives appear increasingly concerned about its effects, with 70% of respondents reporting that they expect climate change to have a high or very high impact on their company’s strategy and operations over the next three years, up from 61% last year. Among the top climate-related issues that are already impacting companies, 51% of executives noted changing consumption patterns or preferences, followed by 50% citing regulations aimed at decreasing emissions or environmental impacts, and 50% reporting operational impacts from climate-related disasters or weather events.
While executives reported becoming more concerned about climate change, however, the report found that they are also increasingly focused on opportunities to achieve direct benefits to their businesses through their sustainability-related investments and initiatives. Material benefits such as supply chain efficiency and resilience and operating margins ranked within the top 5 benefits already being experienced by companies as a result of their sustainability efforts, compared with less tangible benefits such as brand recognition and reputation reported in the prior year survey. Notably, nearly half of respondents said that their companies are already taking action on developing new climate-friendly products or services.
Looking ahead, executives are anticipating innovations around their operations and offerings as the top benefit expected from their sustainability efforts, cited by 38%, with other benefits including addressing climate change (37%) the ability to recruit and retain talent (36%), and cost savings and lower cost of capital (36%).