About the past For years, environmental, social and governance (ESG) initiatives have taken the business world by storm. The bottom line was no longer the only thing that mattered. Clients and investors alike wanted to know how companies are addressing a wide range of ESG issues, from climate change to diversity, equity and inclusion.
More recently, the model has come under increasing fire. Political attacks on ESG principles coupled with shaky macroeconomic conditions, a stronger drive for profit than growth, and an energy crisis in Europe have forced some companies to cut back on their promises, especially if they were not fully committed from the start.
To be clear, many companies are making great strides in reducing their carbon pollution, an effort that falls under the larger umbrella of ESG considerations. That could be using cleaner energy sources for manufacturing, more environmentally friendly packaging for consumer goods, or selecting cloud providers that strive to run the most energy-efficient data centers.
No matter how companies approach becoming a greener organization, the question is whether they stay true to their promises, especially as economic conditions tighten. For some, ESG commitments are more about appearances than action. Unfortunately, the Google Cloud Sustainability Survey 2023 suggests that the executive’s resolve is waning. That, or those who were in it just for the marketing benefit are starting to come clean.
As proof, the study found that economic pressures this year have pushed ESG concerns to third on organizations’ list of priorities, up from the top spot they held last year. “Many executives point to the macroeconomic environment and pressure from outside parties to cut back on their sustainability initiatives and prioritize customer relationships and revenue generation,” the report said.
Google commissioned The Harris Poll to survey 1,476 VP and C-suite executives from around the world in various industry sectors. The report found that the number of sustainability projects implemented, rather than just planned, was down 8% from last year.