As we kick off a new year, it’s a good time to take a look at what is trending in the world of sustainability. As the last few years have shown us, climate change combined with the COVID-19 pandemic has caused trends in sustainability to accelerate quickly and an increased amount of energy is being placed on finding solutions to shape the future. It’s extremely clear that there is an inherent need for radical change when it comes to the ways companies address their impact on the planet and work to reduce it in the new year and beyond.
1. Sustainability is the “new normal”
From food production, to packaging, to fashion to lifestyle products, there is a clear effort to replace traditional demands with sustainable alternatives. It’s highly likely that the demand for sustainable products by consumers will make their production mandatory in the next few years. The 2021 global analysis commissioned by the World Wildlife Fund and conducted by the Economist Intelligence Unit, shows the popularity of internet searches for sustainable goods has increased globally by more than 70% in the last five years. That’s a clear indicator that sustainability matters to customers and clients.
2. A shift in consumption
More industries are learning how they can better incorporate reusing, repairing, refurbishing, and recycling current materials and products within their business model. Patagonia, a US brand, has transitioned to a more circular process by establishing material and environmental and social responsibility programs, as well as by taking stock of where they do business. Their efforts so far mean 100% of their US electricity needs are met with renewable energy and 87% of their production line uses recycled materials. They also support Fair Trade and livable wage efforts and are extremely transparent about their efforts to fight for a more sustainable world. During 2022, we expect efforts like these to continue to grow among businesses.
3. ESG investments are top priority
As we highlighted in November, the pandemic escalated environment-driven ESG into a whole new realm. ESG (Environmental, Social and Governance) investments examine the long-term impact on the environment and have become an immensely popular tracking method that not only compels companies to be more open about their environmental impact, it forces the question: can you improve the world AND make money? We’d say that the answer is yes. And with so many companies scrambling to get on the sustainability train, global ESG assets will continue to be vitally important.
4. Pushing for Renewable Energy
The time is long gone where fossil fuels could be considered the most cost-effective source of energy. Even in the last 10 years, the cost of implementing renewable technologies (such as wind and solar) have fallen substantially and are now the world’s cheapest energy supply. According to the International Renewable Energy Agency, nearly two-thirds of the wind, solar, and other renewable energy sources in 2020, 62% were more economical than the most inexpensive new fossil fuel. There couldn’t be better news for the planet, but it’s time to get coal plants to retire and businesses to focus on implementing renewable energy sources. This alone would save billions of dollars and reduce the emission of about three gigatonnes of CO2 a year! That works out to be about 20% of the reduction in emissions that is needed by 2030 in order to avert climate catastrophe. It would certainly be a step in the right direction.
5. Requiring Companies to be transparent about environmental impacts
As we kick off a new year, it’s important to note that we continue to see more states and cities around the world requiring businesses to report on their emissions and energy use, as well as their social impact. Indicators include greenhouse gas emissions, waste and water usage, and the environmental impact of products throughout their lifecycle. For a company that shows negative social and environmental performance in their reporting, it could mean being shut down.
This year, we renew the push for continued climate action and for businesses to take indicators seriously in order to invest in a better future for everyone.