Dec 16, 2021
5 Sustainability trends to expect in 2022
The weather has cooled down, the flip flops and bathing suits have long been stashed in the backs of closets, the novelty of "sweater weather" has faded, and it’s almost time for the new year. From COP26, to the ongoing coronavirus pandemic, 2021 was a big year in sustainability. As 2021 comes to a close, we’re looking forward to next year by examining some trends in sustainability to keep an eye out for in 2022.
Here are the sustainability trends you can expect in 2022:
An increase in ESG investing
An increase in stakeholder influence
Working from home may be here to stay
More ambitious climate positivity goals will boost demand for carbon offsets in 2022
A higher demand for data-driven sustainability reporting
1. An increase in ESG investing
Investors are increasingly considering companies’ Environmental, Social, and Governance (ESG) activities when making investment decisions, and this sustainability trend will continue to accelerate in 2022.
A study by Deloitte found that 53% of financial services firms surveyed say that sustainability either already is, or is becoming, central to the organization. BlackRock, the world’s largest asset manager, has famously stated it will require companies to report their ESG activities in line with standards such as the Sustainability Accounting Standards Board (SASB).
The increased demand for ESG disclosure is not without reason. Research from McKinsey shows that companies with high ESG ratings tend to outperform the market in both the medium and long terms.
2. An increase in stakeholder influence
All around your company, people are likely becoming more aware of sustainability. This is true not just for investors, but also stakeholders such as customers, employees, and job seekers.
This trend has been coming for a while but was accelerated by the pandemic, with Boston Consulting Group finding that 70% of survey participants say they are more environmentally aware now than they were before the pandemic. This trend in the increase in stakeholder influence will require companies to consider not just their shareholders, but rather all their stakeholders.
3. Working from home may be here to stay
In addition to trends in what company people prefer to work for, 2022 will see the continuation in the shift of how people prefer to work. The coronavirus pandemic brought about seemingly overnight changes to how we live and go about our daily lives. One of the ways this was most apparent is in the way we work.
The pandemic forced millions of workers around the world to work remotely from home. Many companies and workers alike have since discovered the benefits of working from home, and in 2022 you can expect the demand for remote work to stay.
The hybrid working model is expected to become increasingly normalized and acceptable, even as the pandemic slowly lessens in severity. Remote work brings about many social benefits, with 52% of employees reporting they would prefer a more flexible hybrid working model post-pandemic. There are also environmental benefits, such as fewer vehicles on the road due to fewer people commuting, translating to lower emissions.
4. More ambitious climate positivity goals will boost demand for carbon offsets in 2022
While net-zero emissions targets are a step in the right direction, 2022 will see more and more companies upping their game towards climate positivity goals. The increase in companies going net-zero and climate positive means an increasing demand for carbon offsetting. Carbon offsetting is the reduction and replacement of carbon emissions.
Net-zero emissions refers to a company balancing the amount of greenhouse gas emissions it releases with the amount it removes from the atmosphere. Ideally, a company first assesses all its Scope 1, 2, and 3 emissions and eliminates or lowers those emissions as much as possible. The emissions that truly cannot be eliminated are then "balanced out" by supporting carbon offset projects, such as organizations that plant trees, or supporting the development of new carbon sequestration technology.
It's becoming clear that net-zero targets will not be enough to limit global warming to 1.5 degrees Celsius. Therefore, 2022 will see companies setting more ambitious climate positivity targets. Climate positive companies take things one step further by removing more carbon from the atmosphere than they emit. Overtime, a climate positive company is helping to reverse environmental degradation.
5. A higher demand for data-driven sustainability reporting
Measuring the impact of sustainability efforts has never been so important, as the planet continues down a dangerous path towards 3°C of warming by the end of the century.
For individual companies, sustainability reporting is also increasingly important to maintain the trust of investors, customers, and employees. In a world where greenwashing and SDG washing have made stakeholders skeptical of companies’ sustainability promises, transparency is key.
And if transparency is the key to building trust in your company’s sustainability among stakeholders, then data is the metal carefully melted down and formed into that key. Next year will see an acceleration in the demand for sustainability data and sustainability reporting.
Gathering high-quality sustainability data enables your company to generate sustainability reports that communicate the results of sustainability activities to regulators, investors, and other stakeholders. It also helps you make sure you’re getting the desired results from your sustainability projects.
At the same time, sustainability data reporting remains a real challenge for companies. The collecting and processing of sustainability data is currently very time consuming and error-prone. At SustainLab, we say it doesn’t have to be this way.
We’ve built a cutting-edge sustainability management software that is your SaaS one-stop shop for gathering, processing, and visualizing your sustainability data and progress. Set goals and track your progress consistently so you always know where you’re at versus where you need to be.
Contact us today to book a demo and learn about how SustainLab’s sustainability management software can help your company keep up with sustainability trends in 2022 and beyond!