Last Updated on January 28, 2024 by News Editor
As the world battles the impacts of climate change, companies are under increasing pressure to take a proactive stance in reducing their carbon footprint and achieving carbon and climate neutrality through sustainability initiatives. However, despite their best efforts, many companies struggle to progress significantly in their sustainability efforts due to various challenges. Google’s latest insights shed light on some critical obstacles companies face in pursuing sustainability.
The survey reveals that economic headwinds and challenges in accurately measuring ESG efforts hinder sustainability initiatives for around 50% of global executives. Lack of organizational structure also contributes to slow progress. Organizations need help to implement effective ESG frameworks, which results in a lack of consensus on how to approach sustainability initiatives.
Sustainability Programs Decline as Companies Struggle with Economic Headwinds
In early 2023, Google Cloud teamed up with Harris Poll to survey over 1,400 high-level executives across various industries and regions, including the Americas, Europe, the Middle East, Africa, and Asia-Pacific. The survey revealed that nearly half of executives believe the global economic climate hinders progress in their sustainability efforts. Regional conditions, such as the energy crisis in Europe, were found to be further exacerbating the issue. As a result, the number of new sustainability programs implemented in 2023 decreased by 8% compared to the previous year. With the economic downturn continuing, companies find it challenging to balance their financial obligations while maintaining sustainability practices.
Sustainability Initiatives Decline Year-Over-Year, Despite Growing Concerns
Executives at nearly all organizations report having at least one sustainability program in place. But many executives are cutting corners and declining to implement new sustainability programs. The survey found that 45% of executives believe the current economic climate hinders progress. Additionally, ESG efforts have fallen from top priority in 2022 to third place in 2023. These findings were disclosed when global concerns about financial instability, high debt levels, and geopolitical tensions grew. According to the International Monetary Fund, this year’s projected global economic growth has been lowered by 0.1% to 2.8%, below the historical average of 3.8% over the 2000 to 2019 period.
Green Hypocrisy Remains a Major Concern
The survey revealed that corporate greenwashing and green hypocrisy remain major concerns among respondents, underscoring the urgent need for tangible measures of ESG impact. When companies cannot effectively measure sustainability efforts, they struggle to communicate authentically about sustainability progress and overstate their efforts. The report shows that 4 out of 5 executives agree with this. Additionally, 72% of respondents believe that most organizations in their industry would actually be caught greenwashing if investigated thoroughly. As sustainability becomes an increasingly significant aspect of corporate responsibility, companies must demonstrate their commitment through concrete actions and transparent reporting.