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The Sustainability News Update: 2024 in review

Ah, Christmas-time content.

The Only Fools And Horses festive special, Channel 5’s 100 greatest moments countdowns, And now, the PRmoment sustainability year-in-review, with a healthy dollop of ESG.

If you look back over the topics this review column covered in 2024, you could be forgiven for feeling a little glum. This year saw politicians and regulators softening stances on areas of environmental actions, DEI programmes becoming a political football, corporate governance in the spotlight for the wrong reasons on occasion and the term ESG seemingly in its death throes.

But Christmas is a time to be happy, so there’s a more positive way to view all of that too.

The pace of the transition to a cleaner economy may be contentious, but many businesses have reported marked progress in their actions to reduce emissions. DEI’s weaponisation is prompting a rethink on long-term, sustained change. Corporate scandals may prompt better business behaviour (we hope). And ESG is set to throw off the shackles of its acronym to focus on change that really matters rather than short-term unrealistic scorecards.

It has been quite a year. More people across the world were able to vote in elections than ever before, meaning that sustainability invariably became caught in some political crosshairs. As 2024 began we saw an EU climbdown on corporate sustainability reporting ahead of the Brussels election in June, while in the UK the electoral campaigning before 4th July may not have hinged on the environment, but saw the net zero transition become central to party mudslinging.

Politicians drop the environment

That, according to Sharon Bange, managing director at Kindred, was a missed opportunity. “The main political parties seemed to be working on the assumption that people cared more about money in their pockets than the environment. Cost of living was – and still is – a concern, but that’s only part of the picture,” she said.

“I completed a research study prior to the election which explored the extent to which voters aged over 55 supported the then-Government’s green policies. It found that the back-peddling on heat pumps and electric vehicles was welcomed, but not because these voters didn’t care about the climate crisis - far from it. They deeply cared about the planet but believed such policies were impractical and impossible to deliver on a meaningful scale,” she added.

With the new Government under massive pressure to turn its approval ratings around, she believes that “there’s a further opportunity here to better align the current policy rationale of jobs, economic growth and energy security with the environmental benefits of action.“

With the environmental political tussle in the background, ESG faced its own vote this year - of no confidence, about whether it had lost its way or should be put out of its misery. It began in February as we looked at the phrases doing the rounds as alternatives to ESG such as:

  • Responsible business

  • Impact investing

  • Thematic investing

  • Stewardship

As the year went on, it became clear that ESG as we knew it was having to change (as did the title of this column, to a broader focus on sustainability topics of all forms), but the underlying premise remained solid.

ESG develops new meaning

Charlotte West, VP of global corporate communications at Lenovo, which was an early adopter of annual ESG reports, said that the technology business continues to use the acronym, but that its meaning has shifted. “We do still use the term ESG as it relates to how we talk to our investor and financial communities, but generally refer more broadly to our work and focus around corporate citizenship,” she said.

“This not only helps us frame the kind of work we are and should be doing, but more importantly reminds teams why we’re doing it, and how it’s critical to building and protecting our reputation. ESG as a term has become a catchall that is far away from its original intention as a measurement framework for investors and therefore too easily becomes a box ticking exercise for businesses, rather than answering the question of whether the world is better or worse off with our organisations in it.”

Diversity, equity and inclusion has also had a rocky road this year. Back in March, we covered why corporate DEI programmes had become contentious in what was framed as a Wall Street retreat. By August, pressure from the political right had grown further and we looked at the considerations for companies feeling the squeeze on the public commitments they had made, or standing firm in the face of the debate.

DEI loses substance

“CEOs are currently facing a pincer movement on DEI,” said Matt Carter, founder of message testing agency, Message House. “Many internal teams and external stakeholders are looking for a strong reaffirmation of commitments from companies, at the same time as the political climate around these issues has grown more challenging on both sides of the Atlantic.

“And ironically both advocates and critics of DEI often share a frustration that it has become more about corporate image than substance. Our latest polling shows there remains strong UK public support for steps to create more fairness in the workplace and beyond, suggesting that in 2025 businesses should not retreat from DEI but should work harder to deliver on commitments that make a meaningful difference for their stakeholders,” he said.

At least one area of DEI was brighter, with news in April that the gender pay gap in the UK was now smaller than at any point since regulation to force disclosure was introduced. “This year though at least, we are seeing more and more companies lean in to their data and use it to demonstrate their progress, rather than heavily caveating everything with this being a long road to follow,” was our take.

Pay Gap reporting drives conversation

According to Emily Morgan, managing director of operations and innovation at Red Consultancy, the gender pay gap is an increasingly positive platform for communication. "As more companies are reporting their pay gaps, there is more expectation to communicate the specific actions and strategies they have put in place. It’s all about being open and honest. If firms share their success stories and their plans to continue to close the gap, they will build trust and loyalty with their own workforce as well as attract new talent," she said.

And of course, across the year there were continual stories about the impact of climate change, business action (or inaction) to limit it and the increasing regulation being introduced to counter it. We could fill a book with all of that. Yet several years after many companies made their initial net zero commitments, some of our highlights were about whether climate change impact was making a difference, and what new greenwashing risks were emerging given the rise of “nature positive” communication.

It has been a busy year and one buffeted by the forces of politics, given the succession of elections. Given the economic pressures and widescale changes that 2025 will doubtless bring, better hold on to your hats.

Written by

Steve Earl, partner at Boldt Partners

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