2023 has been full of twists and turns for the net zero agenda, with several sustainability trends shaping the year so far. From Rishi Sunak’s delay of the 2030 ICE ban to Sultan al-Jaber’s plans to use this year’s COP as an opportunity to strike oil deals; it’s certainly had its fair share of drama. But there have been some hugely positive moments, like the ban on single-use plastics for businesses in England, and the introduction of EU regulation on deforestation-free supply chains.
2024 is poised to be yet another pivotal year in the fight against climate change, with the arrival of new legislation like the Corporate Sustainability Reporting Directive (CRSD), important conversations about the future of ESG and language becoming more of a focus for business and organisations.
Here are some of the top trends set to impact the sustainability landscape next year.
Arrival of new legislation
Two key pieces of sustainability disclosure will impact businesses in 2024; the CSRD in the EU and the Securities & Exchange Commission (SEC) in the US. If a company trades in either of these markets, they will be held to this legislation and could be subject to a hefty fine if they don’t meet the requirements.
There is still a huge amount of confusion about what CSRD and SEC stand for, particularly CSRD which will deliver the biggest change to EU corporate sustainability reporting to date. There’s a sense of dismissal within business due to the complexity of the legislation, leading to a lack of engagement amongst SMEs and big corporates. Many are willing to take the hit and pay a fine than have to wrangle with the requirements of the legislation.
It will be interesting to see how things develop next year and whether CSRD really ‘takes off’ as it’s rumoured CSRD could be used as the template for US legislation too.
An evolution of the term ‘ESG’
It’s been an interesting year for the Environmental, Societal and Governance (ESG) space. Divestment in ESG funds in the US is creating uncertainty across the pond and raising questions about the future of ethical funds. In the EU, investment is still flying, but US investors are allegedly backing away from funds that incorporate climate and social risk factors. This could eventually trickle down to the EU market, which could have strong repercussions for the ESG space in 2024 and beyond. ESG was founded in a resilient environment, and with inflation hitting sustainability assets hard, some investors are reconsidering their priorities.
That being said, ESG remains top of the agenda for many organisations albeit perhaps in a different guise. As the term has become increasingly politicised many have called for a revision; retaining the benefits and impact of ESG but rebranding it. Businesses are becoming increasingly aware of the importance of ESG strategies and it will be fascinating to see if there is a shift in how they are marketed and communicated next year.
2024 will be a crucial year for ESG – quite possibly a ‘sink or swim’. Will the framework survive the hostile environment of the 2020s, or will we see a redefining of the concept? Watch this space.
Shift in language and urgency
Aside from lots of chatter about Sultan Al-Jaber’s love for fossil fuels, this year’s COP was a bit different in that there was a lot of discussion about how we talk about sustainability. The use of tepid language like ‘transitioning away’ instead of ‘phasing out’ undermines the urgency needed to deliver on the Paris Agreement, with the Alliance of Small Island States demanding a shift to ‘phase out’.
The term ‘carbon neutral’ has become another bone of contention amongst climate activists who believe we need to move towards ‘carbon negativity’. Carbon neutral means that any CO2 released into the atmosphere from a company’s activities is balanced by an equivalent amount being removed; Carbon negative on the other hand means the activity goes beyond achieving net-zero carbon emissions to create an environmental benefit by also removing additional carbon dioxide from the atmosphere.
Language and action-led statements will become a much greater focus next year; neutral tones and wishy-washy values will become a thing of the past.
Use of Hollywood glam
Brands upped their game this year with flashy campaigns communicating sustainability progress, Apple’s Mother Nature ad serving as a great example. It was greeted by a mixed reception externally, and within PHA’s own walls too. Our Creative Director Mike Chivers argued brands often avoid creativity at the risk of being labelled green-washers. In this film, Apple humanises Mother Nature and communicates some pretty ambitious targets, but in reality, the ad oversimplifies the scale of their contribution. Stickier issues (i.e. electronic waste, battery development and mass consumption) simply don’t feature, and humour becomes the main feature which is likely used as a disarming tool.
Oblivia Coalmine on the other hand received a very different response. As part of the long-running ‘Make My Money Matter’ campaign, the ad sees Olivia Coleman’s alter-ego thanking pension-holders for their contributions towards the fossil fuel industry. Laced with dark comedy, the ad also uses Hollywood talent to get across its message, but in a way that feels more truthful and less consumerist.
We predict more brands and organisations will up marketing efforts next year, with lessons to be taken from Apple’s controversial Mother Nature ad.
