Takeaways
- In 2024, disclosure preparation is a critical sustainability trend, with increased pressure on companies to disclose their ESG performance, leading to regulatory enforcement and a focus on “double materiality.”
- AI can help mitigate 5-10% of global greenhouse emissions by 2030 by analysing data, managing climate-related risks, and producing sustainable, innovative products and services.
- Scope 3 emissions, which account for up to 80% of a company’s emissions, are under scrutiny as companies face pressure to reduce their carbon footprint, with 70% of companies surveyed setting emissions reduction targets for their supply chains.
- Climate-positive technologies, including energy efficiency and solar thermal systems, are gaining traction due to declining costs, advancements, and increased awareness of the need to reduce emissions.
- The COP28 conference highlighted the need for sustainable agriculture to tackle climate change, with a global commitment to transforming food systems and shifting towards circular economy practices and regenerative approaches in agriculture.
In 2023, ESG and sustainability trends continued to gain momentum, with COP28 news highlighting the urgent need for action. The IPCC’s Sixth Assessment Report warned that the window for avoiding the worst impacts of climate change is rapidly closing. At the same time, the report highlighted the potential for sustainable practices to reduce greenhouse gas emissions and promote a healthier planet. As a result, the global corporate landscape is undergoing a significant transformation in 2024, driven by sustainability trends redefining how businesses operate. Companies are at the forefront of this unprecedented change as they face growing pressure to address environmental, social, and governance (ESG) challenges.
Sustainability trends such as the acceleration of disclosure preparation to climate-positive technology and food system transformation are shaping the future of our planet in critical ways. In this article, we will delve into five of the most crucial sustainability trends that are driving this transformation.
Table of Contents
Acceleration of Disclosures Preparation: The Future of Transparency
The acceleration of disclosure preparation is one of the most critical sustainability trends transforming the world in 2024. As investors, consumers, and regulators increasingly demand transparency and accountability, companies are under pressure to disclose their environmental, social, and governance (ESG) performance.
This trend led to the development of regulatory enforcement, including the Corporate Sustainability Reporting Directive (CSRD) and Bursa Malaysia sustainability reporting requirements for Private Limited Companies (PLCs) in Malaysia. Moreover, the governments are encouraging small-medium enterprises (SMEs) to start practising ESG.
The CSRD places particular emphasis on “double materiality,” meaning companies must consider the impact of their operations on the environment and society, as well as how environmental and social factors can affect their viability and profitability. This holistic focus demands a deep understanding of the risks and opportunities associated with sustainability, necessitating a nuanced approach to sustainability reporting. This shift represents a significant change in how companies communicate their ESG practices and results, requiring them to ensure compliance with disclosure requirements and revise and transform their internal processes to effectively gather, verify, and present data.
Artificial Intelligence (AI) for Sustainability: The Future of Innovation
AI is growing rapidly worldwide across the industries. The AI industry is estimated to be worth $1,600 billion by 2030. According to Boston Consulting Group (BCG), AI can help us mitigate 5-10% of global greenhouse emissions. Yet, how does AI help us to do so?
- Data Analysis: AI can help analyse large quantities of data to identify patterns and trends that can inform sustainable decision-making. For instance, AI can monitor energy consumption, water usage, waste production, and greenhouse gas emissions, helping organisations improve energy efficiency, optimise resource use, and reduce environmental impact.
- Climate Risk Management: AI can help manage climate-related risks by predicting extreme weather events, assessing climate-related vulnerabilities, and identifying areas of high risk. This information can be used to develop early warning systems, emergency response plans, and climate-resilient infrastructure.
- Sustainable Innovation: AI can produce sustainable, innovative products and services that reduce environmental impact and promote sustainable practices. For example, AI can be used to develop sustainable supply chains, optimise resource use in manufacturing, and create environmentally friendly products and services.
Read more on how AI can help us to create a sustainable future
The growth of AI for sustainability can be attributed to declining costs, technological advancements, and increasing awareness of the urgent need to reduce carbon emissions. With AI, we can significantly improve our ability to manage resources sustainably, promote sustainable practices, and reduce our environmental impact. However, using AI with a mindful and ethical mindset is essential.
Scope 3 Emission Transparency: The Future of Supply Chain Management
Scope 3 emissions are greenhouse gas emissions from activities outside a company’s direct operations, such as supply chain emissions. As companies come under increasing pressure to reduce their carbon footprint, they focus on their supply chains, which can account for up to 80% of a company’s emissions.
Learn more about what is Scope 1, 2 and 3
According to a report by CDP, 70% of companies surveyed have set emissions reduction targets for their supply chains. With Scope 3 emission transparency, we can significantly reduce our carbon footprint, promote sustainable supply chain management, and create a healthier planet for future generations. However, it takes work to tackle Scope 3 emissions, where the process requires close collaboration and communication with the suppliers and other stakeholders, who might need more sustainable practices and awareness.
Companies might need to invest in technology to monitor and manage their supply chain with greater precision and transparency. Companies will also need to develop sustainable acquisition policies, offer incentives for suppliers to adopt environmentally friendly practices, and collaborate on initiatives to minimise their carbon footprint.
Climate-Positive Technology: The Future of Innovation
Climate-positive technologies are the technologies and innovations that help to reduce or remove greenhouse gas (GHG) emissions and help mitigate climate change. The urge for climate actions has motivated the growth of research and development and technology advancement to fight climate change.
Other than carbon capture and storage (CCS) technology, other climate-positive technologies gaining traction include energy efficiency management systems and solar thermal systems. Energy efficiency management systems use advanced technologies such as IoT sensors, machine learning, and data analytics to optimise energy consumption in buildings and industries.
On the other hand, solar thermal systems use advanced materials and designs to harness the sun’s power and convert it into thermal energy. This energy can be used for various industrial processes, such as heating, cooling, and power generation, even in the agriculture industry for waste management and circular economy improvement to reduce the need for fossil fuels and lower emissions. For example, one of BBC’s innovations with solar thermal energy, Solar thermal Dryer, has helped farmers and the palm oil industry to reduce waste and improve energy efficiency and save cost.
Food System Transformation: The Future of Sustainable Agriculture
The recent COP28 conference highlighted the urgent need to focus on sustainable agriculture to tackle climate change, as the food system is responsible for up to 30% of global greenhouse gas emissions. The Emirates Declaration on Food Systems and Sustainable Agriculture, signed by approximately over 130 countries, underscored the link between food and climate change, signalling a global commitment to transforming our food systems.
One of the critical transformations underway is the shift towards circular economy practices and regenerative approaches in agriculture. Circular economy principles aim to reduce waste and continuously use resources, promoting sustainable resource management. In addition, circular economy practices promote the use of renewable energy sources, such as solar and wind power, to power farming operations and reduce dependence on fossil fuels.
Regenerative agriculture focuses on enhancing the health of the soil, increasing biodiversity and sequestering carbon in the soil. Promoting regenerative agriculture signals the shift in focus on nature-based and science-based solutions to create climate resilience to solve food system problems for future generations.
In conclusion, the world is witnessing a significant shift towards sustainability, driven by technological advancements, changing consumer preferences, and increasing environmental concerns. With the end of COP28 and the welcoming of 2024, sustainable practices are not options but compulsory actions to be taken by individuals, companies, and governments.
Companies can stay ahead among the players by understanding and adopting the five sustainability trends, becoming the leaders in this competitive market.
BBC comprises a team of passionate practitioners implementing solutions for sustainability. Our consultants have extensive knowledge and experience in carbon management, ESG, and sustainability, helping you solve your problems with innovative, sustainable solutions. Book your free 30-minute discovery call and talk to our expert.
Workshop
ESG和永续发展工作坊
透过我们的 ESG 和永续发展工作坊探讨ESG 风险和业务永续发展机遇。本次工作坊将探讨 ESG 和永续性、报告、利益相关者参与以及碳边界调整机制 (Carbon Border Adjustment Mechanism, CBAM) 等全球趋势的基础知识。