5 Big Trends for ESG (2024 Update)

Globally, more and more individuals have become concerned about climate change and sustainability issues which is leading to changed consumer behaviour. In recognition of this, companies are investing in sustainability and biodiversity initiatives, which range from allowing customers to easily recycle products, through to improving manufacturing, through to creating distance from partners who will not meet shared sustainability goals.

But, whilst sustainability and biodiversity is increasingly important to consumers, it is noted that this is tempered against cost, particularly given the current macro- financial environment. That being said, consumers are still making ethical considerations when making purchases, particularly in Europe.

The reasons for improving sustainability and biodiversity go beyond consumer expectations, to mitigating against supply chain disruption, reducing energy costs and meeting the ever growing number of regulations.

We see a continued development of the following sustainability trends:

Accountability

Increasingly, more accountability will be demanded from companies. Especially as the terms ‘sustainability’ and 'biodiversity' become ever-present in the industry, and consumers minds. We expect to see industry investigators becoming ever more watchful of the standards espoused by companies.

Biodiversity

Driven by increasing regulation, such as the Biodiversity Net Gain requirements in the UK, and the EU Biodiversity Strategy for 2030 which are driven by the United Nation's recently developed Kunming-Montreal Global Biodiversity Framework, we see a move in funding from circularity to nature based solutions to limit the impact of climate change.

Affordability

Consumer focused opinions regarding affordability versus sustainability show mixed feelings. In 2022, the average green premium deemed acceptable for sustainable consumer goods stood at approximately 24%. Considering the current financial environment, it comes as no surprise that not all consumers are willing to pay a large sustainability premium. This trend cuts across sectors and correlates with the steel industry, in which low carbon products can command a green price premium of 20 -30%, showing that this premium applies in a B2B stance as well. It pays to be sustainable!

Innovation

For goods to be consumed and disposed of sustainably they must be conceived, designed, and manufactured with sustainability in mind. For many R&D functions, however, a key challenge is finding ways to meet new demands for enhanced sustainability alongside the ongoing need to control costs, meet new customer needs, and differentiate their products from those of their competitors.

For leadership teams this additional complexity needs to be considered, financed, carefully managed, and de- risked. If you're a business leader, who is looking to improve biodiversity efforts at your organization, reach out to us, and we can demo how Biotot can help.

Since future growth rates for many materials are expected to outpace historical growth rates, innovation remains key, particularly given the constraints posed by the expected ‘Materials Transition’.

Partnerships

The complex nature of the sustainability and biodiversity movement requires effective multi-stakeholder collaboration across the wider value chain. Collaborative vehicles offer an advantage in that they can result in greater progress towards sustainable development goals than an organization can achieve alone. That's why our platform works collaboratively with a range of stakeholders. To achieve this progress, collective actions must tackle issues strategic to the core of business operations and resilience. This shift towards creating shared value (and away from corporate social responsibility alone) recognizes the mutual dependence of the competitiveness of a business on the health of the environment and communities around its society more broadly.

Conclusion

Over time trends will change. Understanding who you are as an organization, what you’re sustainability ambitions are will help you manage change and ensure that you provide a service to your customers that is aligned with your brand as a organization.