Without regulatory incentives and leveraging cutting-edge climate intelligence, many organizations would likely overlook the importance of their sustainability initiatives.
Companies responding to regulatory pressures, a significant 65 percent revealed that their organizations would not have undertaken numerous environmental sustainability initiatives without the impetus of government regulations or guidelines? Seventy-five percent of respondents highlighted the urgent need for effective sustainability regulations to achieve globally agreed-upon climate objectives.
The study surveyed 2,152 executives across 727 organisations in 13 countries, including Australia, Germany, India, Italy, Japan, the United Kingdom, and the United States. Approximately 6,500 adults aged 18 and over from 13 distinct markets were surveyed.
According to Capgemini’s research, 69% of companies anticipate more stringent regulations will serve as a primary catalyst for sustainability efforts, a significant increase from 57% in the previous year.
While rules can provide structure and clarity, they can also present obstacles. A major European telecom operator’s governing body warned that environmental, social, and governance regulations risked devolving into mere procedural exercises driven by reporting requirements.
Sven Jansen, Head of Global Finance at Hellmann Worldwide Logistics, notes that while governments drive sustainability efforts through legislation, the increased workload and substantial costs associated with compliance can pose significant hurdles for companies.
The EU’s Company Sustainability Reporting Directive is having a significant impact, with a staggering 73% of executives acknowledging that it has compelled their organization to enhance its sustainability metrics and tracking abilities.
Research findings showed that nearly seven in ten organisations (67%) credited external climate expertise as crucial for achieving their sustainability goals, indicating a strong reliance on specialized knowledge to meet environmental objectives. Seventy percent of respondents pinpointed the pivotal role that knowledge and digital innovations play in expediting the uptake of climate-technology solutions.
Sixty-five percent of respondents revealed that their organization employed generative artificial intelligence (Gen AI) to successfully achieve its sustainability goals. The percentage of respondents indicating a preference for this option has surged to exceed last year’s figure by 44%, as highlighted in the study.
While some boardrooms are engaged in lively discussions about the impact of Generation Artificial Intelligence (Gen AI) on sustainability, with 57% of those polled stating that this topic is a key area of focus. Interestingly, a significant majority – 67% – believe that the benefits of Gen AI far outweigh its potential drawbacks.
According to Capgemini’s separate report for July 2024, approximately one-third of organisations currently monitor their vitality and water usage, as well as carbon emissions associated with the implementation of AI technology.
While the truth is that 68 percent of participants reported sharing sustainability-related information within their entire organization, a significant increase from 56 percent last year and 43 percent in 2022.
Around 84% of respondents reported that their group is on pace to meet its carbon emissions objectives, while approximately 9% recognized they are currently lagging.
As a result, 65% of executives believe that current market conditions are impeding their efforts to invest in sustainability initiatives. Seventy percent of respondents voiced concerns regarding the impact of the uncertain political climate on both sides of the Atlantic on their sustainable investment decisions and initiatives, highlighting the potential risks and uncertainties that may influence their strategies moving forward?
According to José Antonio Coll of Airbus, the company’s international industrial footprint and supply chains mean that geopolitics has a significant impact on their sustainability investments. As we operate across various regions subject to distinct regulations, we have implemented robust risk management protocols to ensure our procurement practices are sustainable and responsible, focusing on both where and how we source materials. Moreover, our operations often involve collaborating with numerous protection ministries; therefore, rigorous export management and meticulous due diligence are vital considerations, deeply informed by the evolving geopolitical landscape.
Despite efforts by companies to downsize their impact on the environment, customers increasingly question the sincerity of these undertakings.
According to Capgemini’s research, the perception of greenwashing among customers has risen significantly, with a staggering 52% of respondents believing that companies and manufacturers are misleadingly promoting their sustainability efforts, an increase of 19 percentage points from last year’s figure of 33%. The report categorizes greenwashing as a misleading practice that involves making inaccurate or exaggerated assertions regarding the environmental benefits of goods and services.
Only approximately 41% of customers report believing an environmental claim about a potential purchase most or all of the time, while nearly 60% indicate that such claims have little to no impact on their purchasing decisions.
While lingering doubts about corporate commitment to sustainability persist, a notable 62% of executives concede that concerns about their initiatives’ authenticity are warranted, casting a shadow over the overall effectiveness of their endeavors.
While 43% of executives acknowledge that customer perceptions of a company’s sustainability efforts may be viewed as greenwashing, The figure has surged upward by 23% since its previous reading of 17% in 2023.
