According to a Deloitte survey of more than 2,000 CxOs across 24 countries, 75% of the organizations increased their sustainability investments over the past years. The survey also revealed that climate change is a top priority for CxOs and is ahead of other issues such as innovation, talent, and supply chain.

The survey also identified some of the challenges and gaps in measuring and disclosing environmental, social, and governance (ESG) data and impact.

The major examples of sustainability-focused investments in the Deloitte survey are:

• Use more sustainable materials: It refers to choosing materials that are lower in environmental impacts, such as recycled, renewable, or biodegradable materials, or materials with a lower carbon footprint, water consumption, or toxicity. Examples include fashion companies using organic cotton, hemp, bamboo, or recycled polyester to make their clothes more sustainable.
• Efficiency is increased with energy use. The amount of energy is reduced by performing a certain task or certain output, such as using LED lights, smart thermostats, energy-efficient appliances, or renewable energy sources. Examples are hotels using smart sensors and devices for adjusting the lighting, heating, and cooling due to the occupancy and preferences of the guests.
• Employee training on climate change means educating and empowering employees to understand the causes and effects of climate change and contributing factors to mitigate and adapt to it. Examples are companies offering online courses, workshops, webinars, or gamified learning platforms for raising awareness and inspiring action among their employees.
• New climate-friendly product or service development: This means new offerings are created to have a lower environmental impact, such as reduction of emissions, waste, or resource use, or by enhancing resilience, adaptation, or regeneration. Examples include automotive companies developing electric vehicles, hybrid cars, or hydrogen fuel cells to reduce their dependency on fossil fuels.
• Waste and emission reduction: the amount of materials and energy that are minimized to discard or release into the environment, such as using circular economy strategies, recycling, composting, or carbon capture and storage. Examples are industrial companies using industrial-resource productivity techniques to reduce resource consumption and waste generation.
• Investments in renewable energy sources: This means using energy sources from natural processes that are replenished constantly, such as solar, wind, hydro, geothermal, or biomass. sources with lower greenhouse gas emissions and environmental impacts than fossil fuels. Examples include companies investing in renewable energy projects or purchasing renewable energy certificates to power their operations.
• External stakeholders engaging in sustainability issues: Communication and collaboration with parties affected by organizations interested in sustainability performance, such as customers, suppliers, investors, regulators, communities, or civil society, It helps build trust, transparency, accountability, and partnerships. Examples are companies engaging with external stakeholders through sustainability reporting, dialogues, consultations, or joint initiatives.
• Executive compensation aligned with sustainability goals means the remuneration of senior leaders and managers is linked to the achievement of sustainability targets and indicators such as carbon emissions reduction, energy efficiency improvement, or social impact creation. It also helps incentivize and reward sustainability, leadership, and innovation. Examples include companies aligning executive compensation with net-zero commitments or ESG performance.

The benefits of sustainability-focused investments are:

• Risk mitigation: Such sorts of investments help in reducing the exposure to environmental, social, and governance (ESG) risks that can negatively affect the performance and reputation of companies. Such as the use of more sustainable materials, companies avoiding regulatory fines, consumer boycotts, or supply chain disruptions due to environmental issues.
• Return potential: Such investments offer attractive returns in the long term, as companies with high ESG standards tend to outperform their peers in terms of profitability, growth, and innovation. Such examples are developing new climate-friendly products or services, tapping into new markets, increasing customer loyalty, or gaining a competitive advantage.
• Aligned with values: Such investments help investors align their portfolios with personal values and beliefs and support companies to make a positive impact on the world. Examples are training employees on climate change, companies fostering a culture of sustainability, empowering the workforce, and enhancing social responsibility.
• World improvement: Such investments also contribute to solving most of the pressing global challenges, such as climate change, social justice, or human rights. Investment in companies is about addressing issues, investors making a difference, and creating a more sustainable future for themselves and others.

Sources:- esgtoday, deloitte, Sustainability focused Investing, the impactinvestor, greenbusinessbureau