Weather-related disasters likely have material impact on sustainability initiatives

The report showed more than six in 10 organisations globally (62%) say recent wildfires, floods, and storms during 2023 will have a material impact on their environmental initiatives.

Another 45% admit the extreme heat will have or has already had a material effect on their near-term plans. Compiled quarterly by Honeywell (NASDAQ: HON) and The Futurum Group, the ESI gauges movement in corporate sentiment and investment on the sustainability front.

“The extreme weather events this year have increased the sense of urgency for immediate action at organisations,” said Gavin Towler, Chief Scientist for Sustainability and Chief Sustainability Officer at Honeywell. “As a result, we should expect to see more organisations looking to accelerate their sustainability efforts and, in particular, adopting a technology-driven approach to their energy transition plans.”

The findings shed light on the plans and progress made in sustainability efforts across regions and industry sectors:

•           Nearly nine in 10 (88%) organisations are planning to increase their budgets for energy evolution and efficiency initiatives.

•           Almost three-quarters (73%) of organisations are at least somewhat optimistic about achieving near-term goals, up from 62% a year ago. The energy sector shows the highest level of confidence among the industries covered in the study.

•           Nearly one in five organisations are now taking a technology-driven approach to their sustainability initiatives – the highest percentage since the launch of the Index.

•           Ninety-two percent of respondents have an ESG reporting process in place, while 30% say the responsibility resides in the C-suite.

“In the region we’ve seen a concerted effort to embed sustainability within all sectors, as a core element of national agendas. The pledges made are significant, with the UAE targeting carbon neutrality by 2050 and the Kingdom of Saudi Arabia, as well as Bahrain, by 2060. These are in addition to Qatar’s commitment to reduce greenhouse gas emissions by 25% by 2030 and Egypt’s plan to increase share of renewables in its power mix to 42% by 2035,” said Mohammed Mohaisen, President and CEO, Middle East and North Africa, Honeywell. “Today approximately 60% of Honeywell’s research and development spend is directed toward improving ESG outcomes for customers, and we are a trusted partner to countries across the region that want locally engineered technologies to help meet ambitious decarbonisation commitments and accelerate economic growth.”

Honeywell’s quarterly Index measures corporate sustainability commitment globally in aggregate. It also compiles data to gauge activity in four specific sustainability areas: energy evolution and efficiency; emissions reduction; pollution prevention; and circularity and recycling. The Index further breaks down its findings by four regions (Asia Pacific, EMEA, Latin America and North America) and eight industry sectors (banking, consumer goods, energy, government/public sector, healthcare, technology, manufacturing/construction and transportation/logistics.)

Daniel Newman, CEO of The Futurum Group, said, “The data is showing that organisations in the public and private sectors are actively forming frameworks to partake in either policy-driven or investment and technological-oriented action in effort to address the global objectives in environmental sustainability.”

Methodology

The Environmental Sustainability Index is based on a global double-blind survey of 751 business, technology, and sustainability professionals directly involved in the planning, strategic development, implementation, or oversight of environmental sustainability goals and initiatives. Panelists were required to be in a leadership role within their organisation, with organisations required to have a minimum of 1,000 active employees. This survey was conducted during Q3 of 2023. The first edition of the survey was conducted during Q2 and Q3 of 2022; the second edition was conducted in Q4 of 2022; the third edition was conducted in Q1 of 2023 and the fourth edition was conducted in Q2 of 2023.