Sustainability Trends: 5 Issues to Watch in 2024

Sustainability is attracting attention in 2024.

Efforts to track and reduce emissions, environmental impacts, and contributions to climate change are no longer rare or optional. Instead, they became the norm. Businesses, governments and individuals now see sustainability as a global imperative. With advanced technology, more stringent reporting standards, and strong stakeholder support, momentum is building for green initiatives and the incentives that encourage them. Here’s what to watch:

Net Zero: The race moves forward

Global interest in achieving net zero emissions, where human-induced greenhouse gas emissions are balanced by the equivalent amount removed from the atmosphere, has intensified in recent years. Many countries have committed to achieving net zero by 2050, in line with the Paris Agreement’s goal of limiting global warming to below 2 degrees Celsius. And companies across a variety of sectors are setting stringent sustainability goals, investing in renewable energy sources, and developing innovative solutions to reduce carbon emissions. These efforts are often driven by stakeholder expectations, regulatory requirements, and the recognition that sustainable business practices can improve profits. And it can generate economic benefits. Research shows that the market for carbon-neutral goods and services could be worth $10.3 trillion to the global economy by 2050.^One

In its pursuit of net zero, the organization will focus its sustainability efforts on two paths in 2024:

• clean energy: The transition from fossil fuels to renewable energy sources is at the core of sustainability strategies and net zero initiatives, and was also a key issue at last year’s UN COP28 climate summit. As part of their energy transition plans, many countries are increasing their use of clean energy, i.e. electricity generated from recycled and renewable sources such as solar, wind, geothermal, etc., to reduce carbon emissions. Companies are investing in renewable energy projects and implementing energy-efficient technologies and practices. These efforts are often aligned with broader corporate sustainability initiatives and can lead to significant cost savings and improved environmental performance.
• sustainable supply chain: As consumer demand for sustainable products grows and awareness of the environmental impact of producing and shipping goods grows, more companies are working to make their supply chain operations more sustainable. This can include human-centric efforts such as using more environmentally friendly packaging or production materials and reducing waste, as well as ensuring fair labor practices and safe working environments. These changes often require rethinking organizational practices and developing new partnerships. Companies are increasingly recognizing that their influence extends beyond their operations. As a result, they are taking steps to address Scope 3 carbon emissions, or carbon emissions emitted by other operators in their value chain.

Sustainability Reporting: Responsibility for Records

This may be the biggest year yet for sustainability reporting. The European Union’s Corporate Sustainability Reporting Directive (CSRD), which requires companies in Europe and other countries to produce annual reports on the environmental and social impacts of their business activities, came into effect in January. In addition to CSRD, California will have new mandatory reporting rules starting in 2024, and countries around the world are on the verge of implementing their own non-financial disclosure and documentation requirements.

Investors, regulators and stakeholders are increasingly demanding that companies disclose their exposure to climate-related risks, such as dependence on fossil fuels or vulnerability to weather events. Mandatory reporting and voluntary disclosure can help companies identify and manage climate-related risks and provide valuable information to investors and other stakeholders to increase transparency.

Reporting is also becoming important in corporate social responsibility initiatives. As more companies set broad environmental, social, and governance (ESG) goals, it becomes increasingly important to find ways to track and accurately document progress. The transparency provided by regular and thorough reporting is one way to help prevent greenwashing or misleading claims about sustainability and environmental impact. Regulated documents enable consumers, governments, and other stakeholders to make better decisions based on trustworthy information.

However, complying with the various mandatory reporting rules around the world can be confusing and complex. One survey found that 81% of companies are creating new roles and responsibilities to accommodate increasing disclosure requirements, while 99% of companies are somewhat likely to invest in more technology and tools related to ESG reporting. or very high.² For example, some companies are turning to software solutions that make it easier to collect, manage and report ESG data.

Circular Economy: When Waste Becomes a Resource

I don’t waste it, I don’t want it. Circular economy models, which aim to minimize unnecessary waste and make the best use of resources, are rapidly growing. Encourage reuse and recycling of products instead of viewing them as disposable. According to the study, the transition to a circular economy is expected to generate $4.5 trillion in economic benefits by 2030.^three

Companies have an important role to play in promoting a circular economy by redesigning products to increase durability, reusability or recyclability, reduce resource consumption and reduce waste throughout the product life cycle. Retailers, especially the fashion industry, are increasingly embracing circular business models. Rental and resale programs provide growth opportunities, and repair services provide an alternative to landfill disposal. Other companies are also getting involved by offering product life extension, recycling or refurbishment schemes.

Biodiversity: positive embrace of nature

Biodiversity loss, one of the effects of climate change and ecosystem disturbance, poses a serious threat to the future of the Earth. The World Economic Forum’s Global Risks Report lists biodiversity loss as one of the top five threats to humanity over the next decade. More than half of the world’s GDP is somewhat or highly dependent on nature.⁴

Efforts to preserve biodiversity and natural resources gained momentum when countries signed the Global Biodiversity Framework at the United Nations COP15 summit in December 2022. Around the world, governments, businesses, and non-profit organizations are implementing initiatives to establish protected areas, restore degraded ecosystems, and encourage sustainable agricultural and forestry practices.

They are also shifting to a new perspective called “affirmation of nature.” Similar to “carbon neutrality” in the context of emissions, nature positivity means stopping, avoiding, and reversing environmental destruction. This can be quantified by measuring indicators such as tree cover, habitat integrity, and number of species, and is determined by sustainable development principles. The goal is to have more nature available than we have today by 2030, which means taking actionable action in 2024.

Sustainable Technology: New Ways to Get More Done

With the boom in artificial intelligence (AI), machine learning (ML), and many other cutting-edge technologies, 2024 will be the year of technology-driven sustainability. As companies consider their climate impacts in the coming year, several tools and features can help guide key sustainability goals.

• A.I: AI can help optimize energy consumption, reduce emissions and support decision-making processes in developing sustainability strategies. Some organizations are leveraging the power of AI to drive self-sustainability. For example, providing more accurate climate forecasts, optimizing energy use in buildings, or identifying areas of waste or inefficiency in the supply chain.
• Industry 4.0: Manufacturers are integrating emerging technologies, including the Internet of Things (IoT), cloud computing, AI, and machine learning, across their production facilities and operations. The smart factories that make up Industry 4.0 have features that provide increased automation, predictive maintenance, self-optimization of process improvements, and efficiencies that reduce both emissions and overall costs.
• software solutions: As mentioned, software solutions can help companies navigate increasingly complex mandatory ESG reporting requirements. For example, IBM Envizi ESG Suite can efficiently collect hundreds of data types, analyze data across silos, and easily deliver auditable reports. Otherwise, it will be a labor and cost intensive process. Environmental, health and safety (EHS) software can streamline data collection and incident reporting, track safety inspections and certifications, and guide risk assessment and mitigation, while environmental intelligence software can monitor the weather for potential disruptions and It can inform decision-making.

Sustainability Trends 2024: The Year Ahead

As we progress through 2024, these sustainability trends will shape the global response to the urgent challenges of climate action and environmental impacts. By understanding these key sustainability trends, your organization can better navigate the path to a more sustainable future.

Join the IBM Sustainability Community

1 Green transition creates $10.3 trillion opportunity for global economy by 2050, new report finds (link resides outside ibm.com), January 2023

2 Sustainability Action Report (link resides outside ibm.com), Deloitte, December 2022

3 Circular economy could deliver $4.5 trillion in economic growth (link resides outside ibm.com), Accenture, September 2015

4 2020 Global Risks Report (link resides outside ibm.com), World Economic Forum, January 2020