- 85 per cent of companies have increased sustainability investments in the past year, compared to 75 per cent in the previous year
- 70 per cent of managers expect climate change to have a major impact on their company’s strategies and processes over the next three year.
- Almost half of managers want to strategically reorganise their business model to address climate change and sustainability
50 per cent have already started to implement technology solutions to achieve climate or environmental goals, with a further 42 per cent planning to do so in the next two years
Climate change remains one of the top three priorities for business leaders worldwide, ahead of issues such as political uncertainty, competition for talent and changing regulatory frameworks. 85 per cent of managers say they have increased investment in sustainability in the past year – up from 75 per cent a year earlier. Half have already started using technology solutions to achieve climate targets. These are the findings of Deloitte’s ‘2024 CxO Sustainability Report’, which is being published for the third time this year. Over 2,100 managers from 27 countries were surveyed, including 100 from Germany.
‘It’s encouraging to see in the latest data that investment in sustainability efforts has increased significantly and that the focus is on using technology as a catalyst to drive climate solutions,’ explains Joe Ucuzoglu, Global CEO of Deloitte. ‘We are seeing more and more organisations looking to transform their business models to address climate change, use climate action to drive innovation and growth, create new value for their stakeholders and differentiate themselves from their competitors.’
Climate protection as a driver for technology and innovation
The use of climate technology is crucial for decarbonisation. In fact, half of managers have already started to implement technological solutions to achieve climate targets, with a further 42 per cent planning to do so in the next two years. Of those who are already using technology to support their sustainability efforts, more than half say they are doing so to develop more sustainable products and services. Executives see these innovations as likely to be the biggest benefit of their sustainability activities over the next five years (38%).
Managers see sustainability as a value driver
An overwhelming majority of respondents (92%) believe their organisation can grow while reducing greenhouse gas emissions. Remarkably, executives also reported a shift this year towards the direct environmental and business impact of their sustainability efforts. Supply chain efficiency and resilience (37%) and better margins (37%) were among the top five benefits of climate action for the first time this year, displacing items such as brand awareness and reputation.
Managers see the ability to recruit and retain talent as one of the top three benefits of improved sustainability over the next five years. This echoes the findings of Deloitte’s Gen Z and Millennials 2024 survey, which shows that more than four in ten Gen Zs and Millennials have already changed jobs or industries or plan to do so because of environmental impacts. 49 per cent of executives say they are actively preparing workers for green jobs.
‘Executives are starting to see more tangible benefits from climate action for their organisations – they see sustainability as a driver of new products, business models and overall value creation,’ says Prof. Dr Bernhard Lorentz, Global Consulting Sustainability & Climate Leader at Deloitte. ‘The companies in the moderate centre of our analysis are well positioned to take advantage of the broader market trend. They are building on their experience and taking transformative actions such as redesigning processes and infrastructure to be more climate resilient or making it mandatory for their suppliers to fulfil certain sustainability criteria. Ultimately, this more intensive action will help to accelerate progress towards global climate goals.”
The situation in Germany
Climate change is also the most frequently cited priority among managers in Germany and has gained in importance over the past year. More managers included it among their top three priorities, ahead of the economic outlook, the regulatory environment and innovation, including AI.
56 per cent of German managers expect climate change to have a significant impact on their business strategy and processes over the next three years. This is lower than the global average of 70 per cent. Nevertheless, many German companies have further increased their investments in sustainability, which continues to indicate an increased commitment to dealing with climate-related challenges.
Around half of the German companies surveyed stated that they are fundamentally transforming their business models in order to actively tackle climate change. Civil society pressure in particular plays a greater role in this than in other countries. At the top of the list of challenges in sustainability efforts are the lack of political support and sustainable solutions. It should be emphasised that the number of managers who lack support from the top management of their own organisation has increased significantly and exceeds the global average.