Sustainability is a collective responsibility, even if the share is far from equal. From government policy to business initiatives to personal responsibility, no effort made in the name of sustainability is in vain. Business leaders, in particular, have the power to direct their companies to adopt sustainability practices. The question is, how is their attitude towards sustainability?
The 2022 Deloitte CxO Sustainability Report examines business leaders’ and companies’ concerns and actions regarding climate change and environmental sustainability. The report shows a rise in the level of concerns from business executives about climate change.
Rising concerns about climate change
The report is based on a survey of 2,083 C-suite executives across 21 countries. KS&R Inc. and Deloitte conducted the survey in September – October 2021 after the IPCC report came out.
In general, the report reveals a rise in climate change awareness and concern amongst the executives. A good 79% of them agree that the world is at the tipping point for responding to climate change, showing a rise of 20% compared to the previous survey. Similarly, there is also growth from 63% to 88% in the level of optimism in taking action against climate change.
The rise in climate change concerns is in line with the impact felt by the companies. The report shows that 97% of the companies have been affected by climate change, citing the operational impact of climate disaster as the top issue. Companies also feel the increasing pressure to implement climate change-related actions from different stakeholders—from regulators to customers to employees.
Disconnection between awareness and actions
However, despite the rising level of concern, the majority of the companies have yet to incorporate more than one noticeable sustainability action. Only 19% of them have been implementing at least four out of these five actions deemed as “needle-moving” by Deloitte:
- Developing new, climate-friendly products or services;
- Requiring suppliers and business partners to meet specific sustainability criteria;
- Updating or relocating facilities to make them more resistant to climate impacts;
- Incorporating climate considerations into lobbying and political donations; and
- Tying senior leader compensation to sustainability performance.
This shows that currently, it is unlikely for companies to implement bold actions with climate considerations.
For instance, using more sustainable materials is cited as the top action companies take instead of developing new climate-friendly products or services. The report also reveals that companies are having difficulties calculating the cost of transitioning into low-carbon companies.
Finally, the report gives out suggestions to bridge the gap between the level of awareness and the actions taken:
- Follow recognized frameworks to help set the appropriate goals and assess progress;
- Develop a concrete plan to ensure long-term goals have near-term accountability;
- Educate the senior leaders and the board;
- Approach climate metrics with the same attitude as the other operating metrics;
- Drive collaboration; and
- Embed climate considerations into every part of the business.
A collective obligation
Businesses have an obligation to ease the impact of climate change through noticeable sustainability actions. With the earth’s temperature nearly reaching the threshold of the Paris Agreement, the world needs tangible steps to prevent more disasters from happening. Business executives need to move beyond just awareness to influence their companies to take part in the pursuit of sustainability for a better future.
Editor: Nazalea Kusuma
Madina is the Assistant Manager for Program at Green Network Asia. She is an English major graduate from Universitas Indonesia with two
years of demonstrated experience in editorial and creative writing,
researching, editing, and creating content.